Synchrony Financial released third quarter results on Tuesday (October 19) which showed improving credit metrics, accelerating consumer spending, and increased traction on digital channels.
Regarding the securities figures, adjusted earnings of $ 1.67 per share topped the Street at $ 1.49 per share. Consolidated revenue was $ 3.7 billion on an adjusted basis, slightly better than the Street at $ 3.6 billion.
The company said its average active accounts were up 5% to 67.2 million, while new accounts jumped 17% to 6.2 million.
Total loans on the books stood at $ 79.8 billion, up 2% year on year.
On credit quality, the company said loans past due at least 30 days, as a percentage of total end-of-period receivables, were 2.4%, compared to 2.7% per annum. latest. This tally represented $ 1.8 billion.
Net write-offs as a percentage of total average loan receivables were 2.18% compared to 4.42% last year, for the most recent figure of $ 432 million.
Additional materials released by the company showed purchase volumes were up 16% during the period, to $ 41.9 billion. Spending by active account, according to additional release data, increased 30% year-over-year.
In the loan portfolio itself, the company said the volume of home and auto purchases increased 10% to $ 26.7 billion in receivables; health and wellness increased 10% to $ 9.9 billion in receivables. Overall, digital shopping volumes grew 21% to $ 11 billion, as Synchrony noted continued âconsumer behavior changeâ. Digital payments, the company said, made up 65% of total payments, as measured in the most recent quarter.
During the conference call with analysts, the CEO Brian Double noted that future opportunities exist with the expanded strategic partnership with Fiserv “through which small businesses will now be able to access Synchrony products and services and accept private label credit card payments through the point of sale management platform and Fiserv’s Clover company. This will enable accelerated growth for small businesses, enabling merchants to attract more customers and generate more income by providing our customers with greater flexibility and choice in how they shop.
He also said that Synchrony will explore other opportunities to cross-sell Synchrony products to existing Clover merchants.
Read also: Synchrony and Fiserv Extend Partnership to Offer Merchants Synchrony Payment and Funding Options Through Clover
Referring to the buy now, pay later (BNPL) business, management noted that the company provides about $ 15 billion in installment loans, both short and long term, at about 70,000 locations. Purchase volume on closed end products has grown by around 46% per year, according to CFO Brian Wenzel.