Synchrony Financial : Q3'22 Earnings Presentation

3Q'22

FINANCIAL RESULTS

October 25, 2022

Disclaimers

Cautionary Statement Regarding Forward-Looking Statements

The following slides are part of a presentation by Synchrony Financial in connection with reporting quarterly financial results. No representation is made that the information in these slides is complete. For additional information, see the earnings release and financial supplement included as exhibits to our Current Report on Form 8-K filed today and available on our website (www.synchronyfinancial.com) and the SEC's website (www.sec.gov). All references to net earnings and net income are intended to have the same meaning. All comparisons are for the third quarter of 2022 compared to the third quarter of 2021, unless otherwise noted.

This presentation contains certain forward-looking statements as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are subject to the "safe harbor" created by those sections. Forward-looking statements may be identified by words such as "expects," "intends," "anticipates," "plans," "believes," "seeks," "targets," "outlook," "estimates," "will," "should," "may" or words of similar meaning, but these words are not the exclusive means of identifying forward-looking statements. Forward- looking statements are based on management's current expectations and assumptions, and are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. As a result, actual results could differ materially from those indicated in these forward-looking statements. Factors that could cause actual results to differ materially include global political, economic, business, competitive, market, regulatory and other factors and risks, such as: the impact of macroeconomic conditions and whether industry trends we have identified develop as anticipated, including the future impacts of the novel coronavirus disease ("COVID-19") outbreak and measures taken in response thereto for which future developments are highly uncertain and difficult to predict; retaining existing partners and attracting new partners, concentration of our revenue in a small number of partners, and promotion and support of our products by our partners; cyber-attacks or other security breaches; disruptions in the operations of our and our outsourced partners' computer systems and data centers; the financial performance of our partners; the sufficiency of our allowance for credit losses and the accuracy of the assumptions or estimates used in preparing our financial statements, including those related to the CECL accounting guidance; higher borrowing costs and adverse financial market conditions impacting our funding and liquidity, and any reduction in our credit ratings; our ability to grow our deposits in the future; damage to our reputation; our ability to securitize our loan receivables, occurrence of an early amortization of our securitization facilities, loss of the right to service or sub-service our securitized loan receivables, and lower payment rates on our securitized loan receivables; changes in market interest rates and the impact of any margin compression; effectiveness of our risk management processes and procedures, reliance on models which may be inaccurate or misinterpreted, our ability to manage our credit risk; our ability to offset increases in our costs in retailer share arrangements; competition in the consumer finance industry; our concentration in the U.S. consumer credit market; our ability to successfully develop and commercialize new or enhanced products and services; our ability to realize the value of acquisitions and strategic investments; reductions in interchange fees; fraudulent activity; failure of third-parties to provide various services that are important to our operations; international risks and compliance and regulatory risks and costs associated with international operations; alleged infringement of intellectual property rights of others and our ability to protect our intellectual property; litigation and regulatory actions; our ability to attract, retain and motivate key officers and employees; tax legislation initiatives or challenges to our tax positions and/or interpretations, and state sales tax rules and regulations; regulation, supervision, examination and enforcement of our business by governmental authorities, the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act") and other legislative and regulatory developments and the impact of the Consumer Financial Protection Bureau's (the "CFPB") regulation of our business; impact of capital adequacy rules and liquidity requirements; restrictions that limit our ability to pay

dividends and repurchase our common stock, and restrictions that limit the Bank's ability to pay dividends to us; regulations relating to privacy, information security and data protection; use of

third-party vendors and ongoing third-party business relationships; and failure to comply with anti-money laundering and anti-terrorism financing laws.

For the reasons described above, we caution you against relying on any forward-looking statements, which should also be read in conjunction with the other cautionary statements that are included elsewhere in this presentation and in our public filings, including under the heading "Risk Factors Relating to Our Business" and "Risk Factors Relating to Regulation" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2021, as filed on February 10, 2022. You should not consider any list of such factors to be an exhaustive statement of all the risks, uncertainties, or potentially inaccurate assumptions that could cause our current expectations or beliefs to change. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as otherwise may be required by law.

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3Q'22 Financial Highlights

SUMMARY

$1.47

DILUTED EPS

compared to $2.00

$86.0 billion

LOAN RECEIVABLES

compared to $76.4 billion

66.3 million

AVERAGE ACTIVE ACCOUNTS

compared to 67.2 million

FINANCIAL METRICS

15.52%

NET INTEREST MARGIN

compared to 15.45%

3.00%

NET CHARGE-OFFS

compared to 2.18%

36.5%

EFFICIENCY RATIO

compared to 38.7%

CAPITAL

14.3%

CET1

liquid assets of $16.6 billion, 16.4% of total assets

$68.4 billion

DEPOSITS

82% of current funding

$1.1 billion

CAPITAL RETURNED

$950 million share repurchases

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3Q'22 Business Highlights

BUSINESS EXPANSION		GROWTH METRICS

Purchase Volume

$ billions

6%

Core(a)	$38.4	$44.6
	16%

Dual Card /	$13.7	$17.5	28%
Co-Brand(b)

Loan receivables

$ billions

13%

Core(a)

$75.5

$85.9

14%

Dual Card /		29%
Co-Brand(b) $15.3	$19.7

Average active accounts

in millions

(1)%

Core(a)

61.3

66.2

8%

CONSUMER PERFORMANCE

New Accounts(c)

(6)%

Core(a)

5.7

5.8

2%

Purchase Volume per Account(d)

8%

Average Balance per Account(e)

8%

(a) All metrics shown above on a Core basis are non-GAAP measures and exclude from both prior year and current year amounts related to portfolios that were sold in 2Q'22. See non-	4
GAAP reconciliation in the appendix.

Financial Results

Summary earnings statement

					B/(W)
$ in millions, except per share statistics	3Q'22		3Q'21	$			%
Total interest income	$4,342	$3,898		$444			11 %
Total interest expense	414		240		(174)			(73) %
Net interest income (NII)	3,928	3,658		270			7 %
Retailer share arrangements (RSA)	(1,057)	(1,266)		209			17 %
Provision for credit losses	929	25		(904)			NM
Other income	44	94		(50)			(53) %
Other expense	1,064		961		(103)			(11) %
Pre-tax earnings	922	1,500		(578)			(39)%

3Q'22 Highlights

• $703 million Net earnings, $1.47 diluted EPS

• Net interest income up 7%

- Interest and fees on loans up 10% driven primarily

by growth in average loan receivables, partially

offset by impacts of portfolios sold during Q2'22

- Interest expense increase attributed to higher

benchmark rates and higher funding liabilities

• Retailer share arrangements decreased (17)%

- Decrease driven by the impact of portfolios sold

during Q2'22 and program performance

• Provision for credit losses up

- Primarily driven by a reserve build of $294 million in

Provision for income taxes

Net earnings

Preferred dividends

Net earnings available to common stockholders

Diluted earnings per share

219		359		140		39 %
703	1,141	(438)	(38)%
11		11		-		- %
$692	$1,130	$(438)	(39)%
$1.47	$2.00	$(0.53)	(27)%

Q3'22 vs. a reserve release of $407 million in the

prior year

• Other income down (53)%

- Lower other income driven primarily by higher

loyalty costs

• Total Other expense up 11%

- Increase primarily driven by higher employee costs

and other expense

- Total other expense includes $27 million of

additional marketing and growth reinvestment of 2Q

Gain on Sale proceeds

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