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SYNCHRONY FINANCIAL MANAGEMENT REPORT ON FINANCIAL POSITION AND RESULTS OF OPERATIONS (Form 10-Q)

By on July 21, 2022 0
The following discussion and analysis of our financial condition and results of
operations should be read in conjunction with our condensed consolidated
financial statements and related notes included elsewhere in this quarterly
report and in our 2021 Form 10-K. The discussion below contains forward-looking
statements that are based upon current expectations and are subject to
uncertainty and changes in circumstances. Actual results may differ materially
from these expectations. See "Cautionary Note Regarding Forward-Looking
Statements."

Introduction and Business Overview
____________________________________________________________________________________________
We are a premier consumer financial services company delivering one of the
industry's most complete, digitally-enabled product suites. Our experience,
expertise and scale encompass a broad spectrum of industries including digital,
health and wellness, retail, telecommunications, home, auto, outdoor, pet and
more. We have an established and diverse group of national and regional
retailers, local merchants, manufacturers, buying groups, industry associations
and healthcare service providers, which we refer to as our "partners." For the
three and six months ended June 30, 2022, we financed $47.2 billion and $87.7
billion of purchase volume, respectively, and had 68.7 million and 69.4 million
average active accounts, respectively, and at June 30, 2022, we had $82.7
billion of loan receivables.

We offer our credit products primarily through our wholly-owned subsidiary, the
Bank. In addition, through the Bank, we offer, directly to retail, affinity
relationships and commercial customers, a range of deposit products insured by
the Federal Deposit Insurance Corporation ("FDIC"), including certificates of
deposit, individual retirement accounts ("IRAs"), money market accounts, savings
accounts and sweep and affinity deposits. We also take deposits at the Bank
through third-party securities brokerage firms that offer our FDIC-insured
deposit products to their customers. We have significantly expanded our online
direct banking operations in recent years and our deposit base serves as a
source of stable and diversified low cost funding for our credit activities. At
June 30, 2022, we had $64.7 billion in deposits, which represented 84% of our
total funding sources.

Our Sales Platforms
_________________________________________________________________

We conduct our operations through a single business segment. Profitability and
expenses, including funding costs, credit losses and operating expenses, are
managed for the business as a whole. Substantially all of our revenue activities
are within the United States. We primarily manage our credit products through
five sales platforms (Home & Auto, Digital, Diversified & Value, Health &
Wellness and Lifestyle). Those platforms are organized by the types of partners
we work with, and are measured on interest and fees on loans, loan receivables,
active accounts and other sales metrics.

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Home and automobile

Our Home & Auto sales platform provides comprehensive payments and financing
solutions with integrated in-store and digital experiences through a broad
network of partners and merchants providing home and automotive merchandise and
services, as well as our Synchrony Car Care network and Synchrony HOME credit
card offering. Our Home & Auto sales platform partners include a wide range of
key retailers in the home improvement, furniture, bedding, appliance and
electronics industry, such as Ashley HomeStores LTD, Lowe's, and Mattress Firm,
as well as automotive merchandise and services, such as Chevron and Discount
Tire. In addition, we also have program agreements with buying groups,
manufacturers and industry associations, such as Nationwide Marketing Group and
the Home Furnishings Association.

Digital

Our Digital sales platform provides comprehensive payments and financing
solutions with integrated digital experiences through partners and merchants who
primarily engage with their consumers through digital channels. Our Digital
sales platform includes key partners delivering digital payment solutions, such
as PayPal, including our Venmo program, online marketplaces, such as Amazon and
eBay, and digital-first brands and merchants, such as Verizon, the Qurate
brands, and Fanatics.

Diversified and value

Our Diversified & Value sales platform provides comprehensive payments and
financing solutions with integrated in-store and digital experiences through
large retail partners who deliver everyday value to consumers shopping for daily
needs or important life moments. Our Diversified & Value sales platform is
comprised of five large retail partners: Belk, Fleet Farm, JCPenney, Sam's Club
and TJX Companies, Inc.

Health & Wellness

Our Health & Wellness sales platform provides comprehensive healthcare payments
and financing solutions, through a network of providers and health systems, for
those seeking health and wellness care for themselves, their families and their
pets, and includes key brands such as CareCredit and Pets Best, as well as
partners such as Walgreens.
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Way of life

Lifestyle provides comprehensive payments and financing solutions with
integrated in-store and digital experiences through partners and merchants who
offer merchandise in power sports, outdoor power equipment, and other industries
such as sporting goods, apparel, jewelry and music. Our Lifestyle sales platform
partners includes a wide range of key retailers in the apparel, specialty
retail, outdoor, music and luxury industry, such as
American Eagle, Dick's Sporting Goods, Guitar Center, Polaris and Pandora.

Company, Other

Corp, Other includes activity and balances related to certain program agreements
with retail partners and merchants that will not be renewed beyond their current
expiry date and certain programs that were previously terminated, which are not
managed within the five sales platforms discussed above, and primarily includes
activity associated with the Gap Inc. and BP portfolios, which were both sold in
the second quarter of 2022. Corp, Other also includes amounts related to changes
in the fair value of equity investments and realized gains or losses associated
with the sale of investments.


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Our Credit Products
____________________________________________________________________________________________
Through our sales platforms, we offer three principal types of credit products:
credit cards, commercial credit products and consumer installment loans. We also
offer a debt cancellation product.

The following table sets forth each credit product by type and indicates the
percentage of our total loan receivables that are under standard terms only or
pursuant to a promotional financing offer at June 30, 2022.

                                                                                     Promotional Offer
Credit Product                             Standard Terms Only         Deferred Interest           Other Promotional                Total
Credit cards                                           57.8  %                     20.4  %                      16.2  %                  94.4  %
Commercial credit products                              2.0                           -                            -                      2.0
Consumer installment loans                              0.1                         0.1                          3.3                      3.5
Other                                                   0.1                           -                            -                      0.1
Total                                                  60.0  %                     20.5  %                      19.5  %                 100.0  %


Credit Cards

We offer the following main types of credit cards:

•Private Label Credit Cards. Private label credit cards are partner-branded
credit cards (e.g., Lowe's or Amazon) or program-branded credit cards (e.g.,
Synchrony Car Care or CareCredit) that are used primarily for the purchase of
goods and services from the partner or within the program network. In addition,
in some cases, cardholders may be permitted to access their credit card accounts
for cash advances. Credit under our private label credit cards typically is
extended either on standard terms only or pursuant to a promotional financing
offer.

•Dual Cards and General Purpose Co-Branded Cards. Our patented Dual Cards are
credit cards that function as private label credit cards when used to purchase
goods and services from our partners, and as general purpose credit cards when
used to make purchases from other retailers wherever cards from those card
networks are accepted or for cash advance transactions. We also offer general
purpose co-branded credit cards that do not function as private label credit
cards, as well as a Synchrony-branded general purpose credit card. Dual Cards
and general purpose co-branded credit cards are offered across all of our sales
platforms and credit is typically extended on standard terms only. We offer
either Dual Cards or general purpose co-branded credit cards through 22 credit
partners, of which the majority are Dual Cards, as well as our CareCredit Dual
Card. Consumer Dual Cards and Co-Branded cards totaled 22% of our total loan
receivables portfolio at June 30, 2022.

Trade credit products

We offer private label cards and dual cards for business customers that are similar to our consumer offerings. We also offer an accounts receivable payment in full business product to a wide range of business customers.

Installment loans

We originate installment loans to consumers (and a limited number of commercial
customers) in the United States, primarily in the power products market
(motorcycles, ATVs and lawn and garden), as well as through our various SetPay
installment products (such as our SetPay Pay in 4 product for short-term loans).
Installment loans are closed-end credit accounts where the customer pays down
the outstanding balance in installments. Installment loans are generally
assessed periodic finance charges using fixed interest rates.

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Business Trends and Conditions
____________________________________________________________________________________________
We believe our business and results of operations will be impacted in the future
by various trends and conditions. For a discussion of certain trends and
conditions, see "Management's Discussion and Analysis of Financial Condition and
Results of Operations-Business Trends and Conditions" in our 2021 Form 10-K. For
a discussion of how certain trends and conditions impacted the three and six
months ended June 30, 2022, see "-Results of Operations."


Seasonality

______________________________________________________________________________________________

We experience fluctuations in transaction volumes and the level of loan
receivables as a result of higher seasonal consumer spending and payment
patterns that typically result in an increase of loan receivables from August
through a peak in late December, with reductions in loan receivables typically
occurring over the first and second quarters of the following year as customers
pay their balances down.

The seasonal impact on transaction volumes and loan receivables balance generally causes our operating results, default metrics and allowance for credit losses as a percentage of total loans receivable to fluctuate between periods. quarterly.

In addition to the seasonal variance in loan receivables discussed above, we
also typically experience a seasonal increase in delinquency rates and
delinquent loan receivables balances during the third and fourth quarters of
each year due to lower customer payment rates, resulting in higher net
charge-off rates in the first and second quarters. Our delinquency rates and
delinquent loan receivables balances typically decrease during the subsequent
first and second quarters as customers begin to pay down their loan balances and
return to current status, resulting in lower net charge-off rates in the third
and fourth quarters. Because customers who were delinquent during the fourth
quarter of a calendar year have a higher probability of returning to current
status when compared to customers who are delinquent at the end of each of our
interim reporting periods, we expect that a higher proportion of delinquent
accounts outstanding at an interim period end will result in charge-offs, as
compared to delinquent accounts outstanding at a year end. Consistent with this
historical experience, we generally experience a higher allowance for credit
losses as a percentage of total loan receivables at the end of an interim
period, as compared to the end of a calendar year. In addition, despite
improving credit metrics such as declining past due amounts, we may experience
an increase in our allowance for credit losses at an interim period end compared
to the prior year end, reflecting these same seasonal trends.

While the effects of the seasonal trends discussed above have remained evident
during the six months ended June 30, 2022, we also continue to experience
elevated customer payment behavior, which include the effects of governmental
stimulus actions, industry-wide forbearance measures and elevated consumer
savings. Customer payments as a percentage of beginning-of-period loan
receivables remain significantly elevated compared to historical averages. These
higher customer payment levels, and resulting impact to both delinquency rates
and net charge-off rates, have acted as a partial offset to the seasonal impact
to our financial results and metrics that we typically experience.
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Results of operations ______________________________________________________________________________________________ Highlights for the three and six months ended June 30, 2022

Below are highlights of our performance for the three and six months ended.
June 30, 2022 compared to the three and six months ended June 30, 2021as the case may be, unless otherwise specified.

•Net earnings decreased to $804 million from $1.2 billion and to $1.7 billion
from $2.3 billion. The decreases in the three and six months ended June 30, 2022
were primarily driven by increases in provision for credit losses due to reserve
releases in the prior year, partially offset by higher net interest income.

•Loan receivables increased to $82.7 billion at June 30, 2022 compared to $78.4
billion at June 30, 2021, driven by strong purchase volume growth, partially
offset by the sale of $3.8 billion of loan receivables in the second quarter of
2022. Excluding the impact of the sale of these portfolios, loan receivables
increased 11.5% reflecting strong purchase volume growth of 12.1% and 14.1% for
the three and six months ended June 30, 2022, respectively.

•Net interest income increased 14.8% to $3.8 billion and 12.4% to $7.6 billion
for the three and six months ended June 30, 2022, respectively. Interest and
fees on loans increased 13.2% and 10.2% for the three and six months ended
months ended June 30, 2022, respectively, driven by growth in average loan
receivables. For the three months ended June 30, 2022, interest expense
increased due to higher funding liabilities. For the six months ended June 30,
2022, interest expense decreased primarily due to lower benchmark interest
rates.

• Stock ownership agreements with retailers increased by 12.0% to reach $1.1 billion and 11.8% at $2.2 billion for the three and six months ended June 30, 2022primarily due to the program’s continued strong performance.

•Over-30 day loan delinquencies as a percentage of period-end loan receivables
increased 63 basis points to 2.74% at June 30, 2022. The net charge-off rate
decreased 84 basis points to 2.73% and 86 basis points to 2.73% for the three
and six months ended June 30, 2022.

•Provision for credit losses increased by $918 million, or 473%, and $1.1
billion, or 789% for the three and six months ended June 30, 2022, respectively,
primarily driven by reserve releases in the prior year periods, partially offset
by lower net charge-offs. Our allowance coverage ratio (allowance for credit
losses as a percent of period-end loan receivables) decreased to 10.65% at
June 30, 2022, as compared to 11.51% at June 30, 2021.

•Other expense increased by $135 million, or 14.2%, and $242 million, or 12.9%,
for the three and six months ended June 30, 2022, respectively, primarily driven
by higher employee costs, marketing and business development, information
processing and other expense.

•TO June 30, 2022, deposits accounted for 84% of our total funding sources. Total deposits increased by 3.9% to $64.7 billion at June 30, 2022compared to
December 31, 2021.

•During the six months ended June 30, 2022, we declared and paid cash dividends
on our Series A 5.625% non-cumulative preferred stock of $28.12 per share, or
$21 million.

•In April 2022, we announced that our Board approved an incremental share
repurchase authorization of $2.8 billion through June 2023 and plans to increase
our quarterly dividend by 5% to $0.23 per common share commencing in the third
quarter of 2022. During the six months ended June 30, 2022, we repurchased $1.7
billion of our outstanding common stock, and declared and paid cash dividends of
$0.44 per share, or $222 million. At June 30, 2022 we have a total share
repurchase authorization of $2.4 billion remaining. For more information, see
"Capital-Dividend and Share Repurchases."

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Partner agreements 2022

In the six months ended June 30, 2022we continued to expand and diversify our portfolio with the addition or renewal of more than 40 partners, including:

•In our Home & Auto sales platform, we announced our new partnership with
Furnitureland South and extended our agreements with Cardi's, Generac Power
Systems, Home Zone, Mathis Brothers, Mattress Warehouse, Mitsubishi Electric
Trane HVAC, NAPA AutoCare, New South Window Solutions, Sleep Number and Sit 'N
Sleep.

• In our diverse and value selling platform, we have extended our program agreement with fleet farm.

•In our Health & Wellness sales platform, we expanded our network through our
new partnerships with Buffalo Veterinary Group, Rarebreed Veterinary Partners,
Service Corporation International and Suveto and extended our agreements with
Encore Vet Group and Lucid.

• We expanded our partnership with AdventHealth to offer CareCredit as our primary patient financing solution across the national footprint.

• In our Lifestyle sales platform, we have extended our program agreements with Guitar Center, Kevin JewelersKymco, Reeds, Sweetwater, Suzuki and Navy Suzuki.

• We launched our SetPay Pay in 4 buy now, pay later solution on Fiserv’s Clover point-of-sale and business management platform.

•We completed the sales of a total of $3.8 billion of loan receivables
associated with our program agreements with Gap Inc. and BP during the second
quarter of 2022, and recognized a gain on sale of $120 million included within
other income in our condensed consolidated statement of earnings.

Revenue summary

The following table sets forth our results of operations for the periods indicated.

                                              Three months ended June 30,                 Six months ended June 30,
($ in millions)                                 2022                  2021                 2022                 2021
Interest income                           $        4,074          $   3,578          $       8,096          $   7,320
Interest expense                                     272                266                    505                569
Net interest income                                3,802              3,312                  7,591              6,751
Retailer share arrangements                       (1,127)            (1,006)                (2,231)            (1,995)

Provision for credit losses                          724               (194)                 1,245                140
Net interest income, after retailer share
arrangements and provision for credit
losses                                             1,951              2,500                  4,115              4,616
Other income                                         198                 89                    306                220
Other expense                                      1,083                948                  2,122              1,880
Earnings before provision for income
taxes                                              1,066              1,641                  2,299              2,956
Provision for income taxes                           262                399                    563                689
Net earnings                              $          804          $   1,242          $       1,736          $   2,267
Net earnings available to common
stockholders                              $          793          $   1,232          $       1,715          $   2,246


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Other financial and statistical data

The following table sets forth certain other financial and statistical data for the periods indicated.

                                                   At and for the                              At and for the
                                            Three months ended June 30,                  Six months ended June 30,
($ in millions)                              2022                   2021                  2022                 2021
Financial Position Data (Average):
Loan receivables, including held for
sale                                   $      83,412           $    76,821          $     83,081           $   77,585
Total assets                           $      96,073           $    93,389          $     95,816           $   94,914
Deposits                               $      64,357           $    61,110          $     63,527           $   62,085
Borrowings                             $      13,537           $    14,425          $     13,791           $   15,039
Total equity                           $      13,462           $    13,655          $     13,595           $   13,365
Selected Performance Metrics:
Purchase volume(1)(2)                  $      47,217           $    42,121          $     87,707           $   76,870
Home & Auto                            $      12,895           $    11,523          $     23,155           $   20,860
Digital                                $      12,463           $    10,930          $     23,659           $   20,270
Diversified & Value                    $      14,388           $    11,618          $     25,946           $   20,838
Health & Wellness                      $       3,443           $     2,988          $      6,550           $    5,636
Lifestyle                              $       1,431           $     1,405          $      2,626           $    2,559
Corp, Other                            $       2,597           $     3,657          $      5,771           $    6,707
Average active accounts (in
thousands)(2)(3)                              68,671                65,810                69,438               66,163
Net interest margin(4)                         15.60   %             13.78  %              15.70   %            13.88  %
Net charge-offs                        $         567           $       684          $      1,125           $    1,383
Net charge-offs as a % of average loan
receivables, including held for sale            2.73   %              3.57  %               2.73   %             3.59  %
Allowance coverage ratio(5)                    10.65   %             11.51  %              10.65   %            11.51  %
Return on assets(6)                              3.4   %               5.3  %                3.7   %              4.8  %
Return on equity(7)                             24.0   %              36.5  %               25.8   %             34.2  %
Equity to assets(8)                            14.01   %             14.62  %              14.19   %            14.08  %
Other expense as a % of average loan
receivables, including held for sale            5.21   %              4.95  %               5.15   %             4.89  %
Efficiency ratio(9)                             37.7   %              39.6  %               37.5   %             37.8  %
Effective income tax rate                       24.6   %              24.3  %               24.5   %             23.3  %
Selected Period-End Data:
Loan receivables                       $      82,674           $    78,374          $     82,674           $   78,374
Allowance for credit losses            $       8,808           $     9,023          $      8,808           $    9,023
30+ days past due as a % of period-end
loan receivables(10)                            2.74   %              2.11  %               2.74   %             2.11  %
90+ days past due as a % of period-end
loan receivables(10)                            1.22   %              1.00  %               1.22   %             1.00  %
Total active accounts (in
thousands)(2)(3)                              65,969                66,892                65,969               66,892


______________________

(1)Purchase volume, or net credit sales, represents the aggregate amount of
charges incurred on credit cards or other credit product accounts less returns
during the period.
(2)Includes activity and accounts associated with loan receivables held for
sale.
(3)Active accounts represent credit card or installment loan accounts on which
there has been a purchase, payment or outstanding balance in the current month.
(4)Net interest margin represents net interest income divided by average
interest-earning assets.
(5)Allowance coverage ratio represents allowance for credit losses divided by
total period-end loan receivables.
(6)Return on assets represents net earnings as a percentage of average total
assets.
(7)Return on equity represents net earnings as a percentage of average total
equity.
(8)Equity to assets represents average total equity as a percentage of average
total assets.
(9)Efficiency ratio represents (i) other expense, divided by (ii) sum of net
interest income, plus other income, less retailer share arrangements.
(10)Based on customer statement-end balances extrapolated to the respective
period-end date.
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Average balance sheet

The following tables set forth information for the periods indicated regarding
average balance sheet data, which are used in the discussion of interest income,
interest expense and net interest income that follows.

                                                                         2022                                                     2021
                                                                     Interest            Average                              Interest            Average
                                                    Average          Income /            Yield /             Average           Income/            Yield /

Three months completed June 30th (in millions of dollars) Balance Expenditure

            Rate(1)             Balance           Expense            

Tariff(1)

Assets

Interest-earning assets:
Interest-earning cash and equivalents(2)          $  9,249          $     20                 0.87  %       $ 13,584          $      4                 0.12  %
Securities available for sale                        5,063                15                 1.19  %          5,988                 7                 0.47  %
Loan receivables, including held for sale(3):
Credit cards                                        78,912             3,943                20.04  %         72,989             3,484                19.15  %
Consumer installment loans                           2,775                69                 9.97  %          2,417                59                 9.79  %
Commercial credit products                           1,654                25                 6.06  %          1,363                23                 6.77  %
Other                                                   71                 2                11.30                52                 1                      NM
Total loan receivables, including held for sale     83,412             4,039                19.42  %         76,821             3,567                18.62  %
Total interest-earning assets                       97,724             4,074                16.72  %         96,393             3,578                14.89  %
Non-interest-earning assets:
Cash and due from banks                              1,614                                                    1,559
Allowance for credit losses                         (8,651)                                                  (9,801)
Other assets                                         5,386                                                    5,238
Total non-interest-earning assets                   (1,651)                                                  (3,004)
Total assets                                      $ 96,073                                                 $ 93,389
Liabilities
Interest-bearing liabilities:
Interest-bearing deposit accounts                 $ 63,961          $    160                 1.00  %       $ 60,761          $    146                 0.96  %
Borrowings of consolidated securitization
entities                                             6,563                40                 2.44  %          7,149                44                 2.47  %

Senior unsecured notes                               6,974                72                 4.14  %          7,276                76                 4.19  %

Total interest-bearing liabilities                  77,498               272                 1.41  %         75,186               266                 1.42  %
Non-interest-bearing liabilities:
Non-interest-bearing deposit accounts                  396                                                      349
Other liabilities                                    4,717                                                    4,199
Total non-interest-bearing liabilities               5,113                                                    4,548
Total liabilities                                   82,611                                                   79,734
Equity
Total equity                                        13,462                                                   13,655
Total liabilities and equity                      $ 96,073                                                 $ 93,389
Interest rate spread(4)                                                                     15.31  %                                                 13.47  %
Net interest income                                                 $  3,802                                                 $  3,312
Net interest margin(5)                                                                      15.60  %                                                 13.78  %



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                                                                         2022                                                     2021
                                                                     Interest            Average                              Interest            Average
                                                    Average          Income /            Yield /             Average           Income/            Yield /
Six months ended June 30 ($ in millions)            Balance           Expense            Rate(1)             Balance           Expense            

Tariff(1)

Assets

Interest-earning assets:
Interest-earning cash and equivalents(2)          $  9,113          $     25                 0.55  %       $ 14,094          $      8                 0.11  %
Securities available for sale                        5,287                24                 0.92  %          6,378                13                 0.41  %
Loan receivables, including held for sale(3):
Credit cards                                        78,738             7,856                20.12  %         73,921             7,141                19.48  %
Consumer installment loans                           2,729               135                 9.98  %          2,319               112                 9.74  %
Commercial credit products                           1,545                53                 6.92  %          1,297                44                 6.84  %
Other                                                   69                 3                 8.77                48                 2                 8.40  %
Total loan receivables, including held for sale     83,081             8,047                19.53  %         77,585             7,299                18.97  %
Total interest-earning assets                       97,481             8,096                16.75  %         98,057             7,320                15.05  %
Non-interest-earning assets:
Cash and due from banks                              1,620                                                    1,597
Allowance for credit losses                         (8,663)                                                 (10,012)
Other assets                                         5,378                                                    5,272
Total non-interest-earning assets                   (1,665)                                                  (3,143)
Total assets                                      $ 95,816                                                 $ 94,914
Liabilities
Interest-bearing liabilities:
Interest-bearing deposit accounts                 $ 63,142          $    287                 0.92  %       $ 61,737          $    316                 1.03  %
Borrowings of consolidated securitization
entities                                             6,695                73                 2.20  %          7,420                95                 2.58  %

Senior unsecured notes                               7,096               145                 4.12  %          7,619               158                 4.18  %

Total interest-bearing liabilities                  76,933               505                 1.32  %         76,776               569                 1.49  %
Non-interest-bearing liabilities:
Non-interest-bearing deposit accounts                  385                                                      348
Other liabilities                                    4,903                                                    4,425
Total non-interest-bearing liabilities               5,288                                                    4,773
Total liabilities                                   82,221                                                   81,549
Equity
Total equity                                        13,595                                                   13,365
Total liabilities and equity                      $ 95,816                                                 $ 94,914
Interest rate spread(4)                                                                     15.43  %                                                 13.56  %
Net interest income                                                 $  7,591                                                 $  6,751
Net interest margin(5)                                                                      15.70  %                                                 13.88  %


____________________

(1)Average yields/rates are based on total interest income/expense over average
balances.
(2)Includes average restricted cash balances of $637 million and $538 million
for the three months ended June 30, 2022 and 2021, respectively, and $626
million and $481 million for the six months ended June 30, 2022 and 2021,
respectively.
(3)Interest income on loan receivables includes fees on loans of $631 million
and $489 million for the three months ended June 30, 2022 and 2021,
respectively, and $1.3 billion and $1.0 billion for the six months ended
June 30, 2022 and 2021, respectively.
(4)Interest rate spread represents the difference between the yield on total
interest-earning assets and the rate on total interest-bearing liabilities.
(5)Net interest margin represents net interest income divided by average total
interest-earning assets.
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For a summary description of the composition of our material items included in our statements of operations, see the MD&A and Discussion of Financial Condition and Results of Operations in our 2021 Form 10-K.

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