Bread Financial Holdings Inc at Barclays Global Financial Services Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Terry Ma - Barclays Capital Inc. - Analyst : Yes. So let's jump right into it. Maybe let's begin with a quick update on third quarter. First, how our spend trends shaping up in the third quarter, last update. We had during earnings, you mentioned July trends had been positive. So has that continued?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Okay. That's helpful. And just the increase in revenue share you just called out, any color on kind of what's driving that? And how persistent will that be kind of go forward?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Got it. Okay. Helpful. So maybe turning to credit. Charge-offs were 7.9% in the second quarter. So improved quite dramatically from last year, largely a function of credit tightening. Obviously, you put out the monthly update this morning. Maybe just talk about kind of credit as you're seeing it in the third quarter and going forward.

Question: Terry Ma - Barclays Capital Inc. - Analyst : Got it. And just maybe touching or following up on the guide for the full year, 7.8% to 7.9%. That was revised lower from your initial guide of 8% to 8.2%. Kind of maybe just talk about what drove this revision? Is it just kind of outperformance, or like, what is it?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Got it. That's helpful. And can you maybe just provide any updates on how borrowers with student loans are behaving?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Okay. That's helpful color. And then longer term, you previously guided to 6% charge-offs. How do you feel about that guide and your pace to returning to that kind of target?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Okay. Got it. So maybe turning to loan growth. You touched on that a little bit. You're currently guiding for growth to be flat to slightly down year-over-year by year-end 2025. How are you kind of tracking to that guide? And then maybe digging in a little bit deeper, is there any interesting behavior you can kind of call out with the cohorts? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 09, 2025 / 3:15PM, BFH.N - Bread Financial Holdings Inc at Barclays Global Financial Services Conference

Question: Terry Ma - Barclays Capital Inc. - Analyst : Anything in particular that you think is kind of driving that improved payment rate?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Okay. And then obviously, you, like many other lenders have tightened underwriting over the last few years. When would you start to feel comfortable kind of unwinding or loosening those tightening actions again?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Got it. And I guess, looking out longer term, are you still expecting mid- to high single digits kind of loan growth? And kind of where do you see additional opportunities in terms of kind of verticals I know products?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Great. Maybe just switching gears, turning to NIM. It's been lower this year, a function of several different things, credit tightening, lower late fees, improved credit and just overall product mix. How should we think about the NIM in the medium and longer term? And particularly as you kind of mitigant start rolling through the portfolio?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Yes, it sounds like there's a lot of moving pieces. But at least in terms of the tailwind from, I guess, higher APR any sense or color you can kind of give on kind of what inning you're in, in terms of kind of that pricing kind of rolling through and benefiting portfolio.

Question: Terry Ma - Barclays Capital Inc. - Analyst : In terms of the APR increases, like what inning are you kind of in --

Question: Terry Ma - Barclays Capital Inc. - Analyst : Got it. I guess on that point, like what percentage of your partners have kind of thought about or have you talked to about kind of rolling back some of the mitigants?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Okay. Got it. That's helpful. And then maybe just on the allowance coverage ratio, it's lower year-over-year. A lot of that due to positive credit performance and also a mix of products. What's the outlook for that?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Got it. Got it. So maybe we'll switch gears. How are you seeing competition in the partnership space shaping up? You recently renewed your Caesars partnership. Can you just expand a little bit on your thoughts on that as well as how you look at the partnership pipeline?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Got it. Maybe staying on the point of de novo partnerships. What are you seeing in the pipeline for that? And where are some opportunities that Bread tap into?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Got it. And what's the, I guess, level of competition like for those de novo partnerships? Like what is it about Bread that allows you to kind of keep winning those?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Great. And then in terms of products, comparing private label to co-brand partnerships, what's more attractive for Bread and why? It certainly seems there's been an increasing shift in mix to co-brand compared to private label. So maybe just walk us through your thought process between.

Question: Terry Ma - Barclays Capital Inc. - Analyst : Got it. I guess when you look at your full suite of products, what do you think is most exciting for you? And where do you see the most growth potential? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 09, 2025 / 3:15PM, BFH.N - Bread Financial Holdings Inc at Barclays Global Financial Services Conference

Question: Terry Ma - Barclays Capital Inc. - Analyst : Got it. So crypto has been highly topical this year, particularly in the card space. You recently partnered with Crypto.com yourself to launch a new card. Can you expand on the opportunities you see in that space? And also maybe just talk about the risks that you're kind of mindful for?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Got it. Maybe we'll switch gears and turn to capital. You touched on it a little bit at the beginning of the presentation, but you recently announced a new share buyback program of $200 million. Your CET1 ratio is about 13% and at the lower end of your medium-term guide. How are you thinking about the uses of kind of capital? And also, how do we reconcile your buyback authorization with the commentary last quarter that you're going to treat capital in the third quarter?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Great. We have a little less than 10 minutes left. I'm going to pause here and opening it up to the audience and see if there's any questions. Questions, anyone?

Question: Terry Ma - Barclays Capital Inc. - Analyst : No. Everyone's shy in the audience usually. So maybe I'll have one more. Like with the late fee rule out of the way, are there kind of any concerns you see on the horizon on the regulatory front for cards?

Question: Terry Ma - Barclays Capital Inc. - Analyst : Okay. Got it. One more time. Any more questions from the audience? Okay. So one more for me. Maybe just talk about tech. AI has been quite a catch phrase recently. Maybe just talk about that. Anything you're looking at in that area that could potentially benefit? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 09, 2025 / 3:15PM, BFH.N - Bread Financial Holdings Inc at Barclays Global Financial Services Conference

Question: Terry Ma - Barclays Capital Inc. - Analyst : Okay. There are no more questions, I think we'll wrap it up there. I'll let everyone off for lunch.