v3.26.3
Variable Interest Entities
 9 Months Ended
Sep. 30, 2026
Variable Interest Entities [Abstract]  
Variable Interest Entities VARIABLE INTEREST ENTITIES
We use VIEs to securitize loan receivables and arrange public and private asset-backed financing in the ordinary course of business through Synchrony Card Issuance Trust, as well as private asset-backed financing through Synchrony Credit Card Master Note Trust and Synchrony Sales Finance Master Trust. Investors in these entities only have recourse to the assets owned by the entity and not to our general credit. We do not have implicit support arrangements with any VIE and we did not provide non-contractual support for previously transferred loan receivables to any of these VIEs in the three and nine months ended September 30, 2026 and 2025. Our VIEs are able to accept new loan receivables and arrange new asset-backed financings, consistent with the requirements and limitations on such activities placed on the VIE by existing investors. Once an account has been designated to a VIE, the contractual arrangements we have require all existing and future loan receivables originated under such account to be transferred to the VIE. The amount of loan receivables held by our VIEs in excess of the minimum amount required under the asset-backed financing arrangements with investors may be removed by us under removal of accounts provisions. All loan receivables held by a VIE are subject to claims of third-party investors.
The loan receivables in these entities have risks and characteristics similar to our other loan receivables and were underwritten to the same standard. Accordingly, the performance of these assets has been similar to our other comparable loan receivables, and the blended performance of the pools of receivables in these entities reflects the eligibility criteria that we apply to determine which receivables are selected for transfer. Contractually, the cash flows from these loan receivables must first be used to pay third-party debt holders, as well as other expenses of the entity. Excess cash flows, if any, are available to us. The creditors of these entities have no claim on our other assets.
The table below summarizes the assets and liabilities of our consolidated securitization VIEs described above:
($ in millions)September 30, 2026December 31, 2025
Assets
Loan receivables, net(a)
$19,922 $20,457 
Other assets(b)
799 46 
Total$20,721 $20,503 
Liabilities
Borrowings$8,915 $8,415 
Other liabilities27 28 
Total$8,942 $8,443 
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(a)    Includes $2.0 billion and $1.9 billion of related allowance for credit losses resulting in gross restricted loan receivables of $21.9 billion and $22.4 billion at September 30, 2026 and December 31, 2025, respectively.
(b)    Includes $794 million and $42 million of segregated funds held by the VIEs at September 30, 2026 and December 31, 2025, respectively, which are classified as restricted cash and equivalents and included as a component of Other assets in our Condensed Consolidated Statements of Financial Position.
The balances presented above are net of intercompany balances and transactions that are eliminated in our condensed consolidated financial statements, including amounts related to servicing of the loan receivables held by our VIEs.
We provide servicing for all of our consolidated VIEs. Collections are required to be placed into segregated accounts owned by each VIE in amounts that meet contractually specified minimum levels. These segregated funds are invested in cash and cash equivalents and are restricted as to their use, principally to pay maturing principal and interest on debt and the related servicing fees. Collections above these minimum levels are remitted to us on a daily basis.
The table below summarizes selected financial metrics of our consolidated securitization VIEs described above:
Three months ended September 30,Nine months ended September 30,
($ in millions)2026202520262025
Interest and fees on loans
$1,146 $1,115 $3,415 $3,232 
Provision for credit losses
$221 $140 $682 $602 
Interest expense
$106 $105 $323 $313 
These amounts do not include intercompany transactions, which are eliminated in our condensed consolidated financial statements.
Non-consolidated VIEs
As part of our community reinvestment initiatives, we invest in funds that invest in affordable housing properties and receive affordable housing tax credits for these investments. We account for these investments using the proportional amortization method, where the costs of the investment are amortized in proportion to the income tax credits and other income tax benefits received. These investments are included in Other assets within our Condensed Consolidated Statements of Financial Position and totaled $938 million and $943 million at September 30, 2026 and December 31, 2025, respectively. At September 30, 2026, we are committed to provide funding related to these investments of $470 million, which is expected to be paid between 2026 and 2044, and is reported within Accrued expenses and other liabilities within our Condensed Consolidated Statements of Financial Position.
The table below summarizes amortization expense and tax credits and other tax benefits associated with investments in affordable housing properties included in Provision for income taxes in our Condensed Consolidated Statements of Earnings:
Three months ended September 30,Nine months ended September 30,
($ in millions)2026202520262025
Amortization expense
$39 $35 $118 $108 
Tax credits and other benefits
$(47)$(45)$(144)$(133)
Our other investments in non-consolidated VIEs totaled $328 million and $301 million at September 30, 2026 and December 31, 2025, respectively, and are included in Other assets within our Condensed Consolidated Statements of Financial Position. At September 30, 2026, the Company also had investment commitments of $200 million related to these investments. We may be required to fund these commitments between 2026 and 2046