Synchrony Financial’s 2025 Annual Report: A Year of Strategic Growth and Stability

For 2025, Synchrony Financial reported a net income of $3.6 billion, reflecting a 1.5% increase from the previous year. This growth can be attributed to a significant decline in the provision for credit losses, which decreased by $1.5 billion due to lower net charge-offs and a reserve release compared to the previous year's reserve build. Additionally, net interest income rose by $455 million, primarily driven by reduced interest expenses and a slight increase in interest and fees on loans. However, this was somewhat offset by a decline in interest income from investment securities.

The company closed 2025 with loan receivables of $103.8 billion, a slight decrease of 0.9% from the previous year. This reduction was influenced by higher payment rates stemming from an improved credit mix, flat purchase volumes, and a decrease in average active accounts. Encouragingly, the over-30 day loan delinquency rate improved, dropping by 21 basis points to 4.49%, while the net charge-off rate fell to 5.65%, a reduction of 66 basis points.

As of year-end 2025, deposits constituted 84% of Synchrony’s total funding sources, with total deposits decreasing by 1.1% to $81.1 billion. The company actively managed its capital by repurchasing $2.9 billion of its common stock and declaring cash dividends totaling $427 million. Importantly, a repurchase authorization of $1.2 billion remained in place at the end of the fiscal year.

October 2025 marked a significant milestone for Synchrony with the acquisition of Versatile Credit, Inc., a financing platform designed to connect merchants, lenders, and consumers through point-of-sale solutions. The company also expanded its collaboration with Lowe's, acquiring the Lowe's commercial co-branded credit card portfolio, valued at approximately $0.8 billion, expected to finalize in the first half of 2026. Additionally, Synchrony divested $0.2 billion in loan receivables related to a Home & Auto partner program, indicating a dynamic approach to its asset management.

Looking ahead, Synchrony anticipates growth in loan receivables and interest income despite a noted decrease in period-end loan receivables for 2025. The company’s asset quality metrics have improved, with expectations for net charge-offs to stay within long-term targets. Funding costs have decreased due to lower benchmark interest rates, and retailer share arrangement payments have risen by 17.6%, reflecting enhanced program performance.

Synchrony Financial's 2025 annual report reflects a year marked by strategic growth, improved asset quality, and a commitment to enhancing its market position through careful acquisitions and partnerships. As the company navigates the evolving consumer financial landscape, it remains focused on operational efficiency and long-term growth strategies, positioning itself for a promising 2026 and beyond.