Synchrony Financial (NYSE: SYF) reported Q4 EPS of $1.15, $0.08 better than the analyst estimate of $1.07.

• Loan receivables decreased 6% to $87.2 billion; loan receivables grew 5% on a Core** basis
• Interest and fees on loans decreased 6% to $4.5 billion; interest and fees on loans increased 5% on a Core basis
• Purchase volume was flat at $40.2 billion; purchase volume was up 7% on a Core basis
• Average active accounts decreased 5% to 74 million; average active accounts grew 3% on a Core basis
• Deposits grew $1.1 billion, or 2%, to $65.1 billion
• Announced a new partnership with Verizon making Synchrony the exclusive issuer of Verizon\'s co-branded consumer credit card which will be launched in the first half of this year
• Established new Payment Solutions relationships: Mor Furniture for Less, Grand Home Furnishings, Travis Industries, and Leisure Pro
• Renewed key Payment Solutions relationships: Rooms To Go, BuyMax Alliance, CFMOTO, and Continental Tires
• CareCredit established a new relationship with Kaiser Permanente, bringing the number of health systems under contract to five, and renewed a key relationship with Demant
• Paid quarterly common stock dividend of $0.22 per share and repurchased $1.4 billion of Synchrony Financial common stock
• Issued $750 million of preferred stock

Earnings

• Net interest income decreased $304 million, or 7%, to $4.0 billion, with the impact from the sale of the Walmart consumer portfolio offsetting loan receivables growth.
• Retailer share arrangements increased $174 million, or 20%, to $1.0 billion, mainly driven by improved program performance and growth in loan receivables.
• Provision for loan losses decreased $348 million, or 24%, to $1.1 billion, largely driven by a lower core reserve build and a reduction in net charge-offs.
• Other income increased $40 million, or 63%, to $104 million, largely driven by lower loyalty program costs as a result of the sale of the Walmart consumer portfolio.
• Other expense remained flat at $1.1 billion and included a restructuring charge of $21 million included in employee costs.
• Net earnings totaled $731 million compared to $783 million last year.

"2019 marked another year of significant transformation for Synchrony. During the year we renewed over 50 partnerships and won 30 new business deals, expanded our CareCredit, Auto and Home networks, significantly enhanced the digital experience for our cardholders, and substantially grew our direct-to-consumer deposit platform. The consistent investments we have made in people and technology have propelled our company forward and empowered leading offerings for our partners and enhanced capabilities and user experiences for our cardholders. Organic growth continues to present the largest opportunity as we have demonstrated in our ability to not only grow existing programs, but also launch new programs with fast-growing partners in new markets," said Margaret Keane, Chief Executive Officer of Synchrony Financial. "Further, we remain focused on executing a capital allocation strategy that helps to drive growth at attractive risk adjusted returns, while maintaining a strong balance sheet and the ability to continue to return capital to shareholders."

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