Bread Financial Holdings Inc at RBC Capital Markets Global Financial Institutions Conference Transcript

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

Question: Jon Arfstrom - RBC Capital Markets - Analyst : So attendance is up. People are more interested in financials, maybe not today, but people are more interested in financials. So I think most of us are familiar with Bread Financial but give us a 30,000 ft overview of the company, and I think it's particularly interesting what you guys do given all of the noise in the economy.

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Yeah, okay. And like all sessions we're open for Q&A, so if you have a question, put your hand up and we can get a microphone in your hands. So full spectrum consumer lending, core funded, much more cleaned up than it was four or five years ago when you got it all.

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Yeah, okay. A lot of focus on the economy and the consumer it's kind of a battleground, I guess and we hear it internally I hear it externally as well, but just give us the Bread Financial overview, the economy, what you're seeing and what the consumers are saying. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 04, 2025 / 4:20PM, BFH.N - Bread Financial Holdings Inc at RBC Capital Markets Global Financial Institutions Conference

Question: Jon Arfstrom - RBC Capital Markets - Analyst : What do you think you need to see to get the confidence that February crest March gets better?

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Okay, so prepare for it in the monthlies March seems to be performing in line with what expect?

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Okay. Spending volume standpoint, what are you seeing in terms of consumer spending? It's moderated a bit, but it still feels like it's okay. Talk a little bit about what you're seeing there.

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Okay, and then touch a little bit on the margin as well. I know there's some seasonality in the first quarter. Just let's get that out of the way and touch a little bit about on your expectations there.

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Okay, so over time it probably improves.

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Yeah okay. You mentioned tightening before, you guys have taken some tightening actions. Talk a little bit about that and what you think the impact has been on growth and then also transactions.

Question: Jon Arfstrom - RBC Capital Markets - Analyst : And do you feel like it's steady state at this point? Are you loosening, tightening, steady state?

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Okay. Okay, you mentioned earlier you talked about credit stabilizing, some of the delinquency trends getting better or less worse. Talk a little bit about your level of confidence in seeing credit eventually improve and what are some of the things that you're looking at and watching?

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Yeah, okay, and you've talked about in the past the kind of the K-shaped recovery. You've been very clear about that.

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Cumulative impacts on the lower end.

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Do you have much higher end exposure? And are you seeing -- call it moderate to higher end, there's been a lot of focus on that.

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Yeah, there's just a lot more focus on the higher end slowing down, which is why I asked that. Okay. I think I probably already know the answer to this, but on reserves and CECL, I think I don't want to say conservative, but you've been conservative. I don't know if that's the right word, but what does it what does it take for your reserve level to eventually come down and you feel like if maybe this tariff thing develops into something worse that you have adequate cushion in your current reserves? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 04, 2025 / 4:20PM, BFH.N - Bread Financial Holdings Inc at RBC Capital Markets Global Financial Institutions Conference

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Okay, good. You talk a little bit about you've won some business recently and you continue to be open for business. Is it competitive and do you have a competitive advantage you feel like with the types of clients you're trying to onboard?

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Okay. It's nice you have a pipeline. I appreciate you sharing that. You feel like you have an advantage. You kind of alluded to it, but an advantage against some of the larger competitors.

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Okay. Question? Unidentified Participant You have a bipartisan bill in the (inaudible) to cap APR and credit card spending at 10%. It's kind of White House support, right? It was a Trump thing, and Vance is a big fan of it now. I mean I think everyone in this room thinks it's ridiculous, right? Like stupid, it's going to go away. But like you have bipartisan support you have White House support, it wouldn't be the first stupid thing government's ever done, right? So like how do you kind of think about regulation, and most of us think there's going to be less regulation under the White House, but then you get things like this.

Question: Jon Arfstrom - RBC Capital Markets - Analyst : I hear you. Most people think about credit a year ago at our conference, there's always some drama around our conference, but they forget that the late fee rule dropped last year at our conference, so that was fun for you. What's the latest on the late fee, how do you handicap the outcome? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 04, 2025 / 4:20PM, BFH.N - Bread Financial Holdings Inc at RBC Capital Markets Global Financial Institutions Conference

Question: Jon Arfstrom - RBC Capital Markets - Analyst : And if it's over what happens?

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Okay. Has it impact the ability to move partners or did gain new business, the late fee piece of it?

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Okay. Positive operating leverage, we talked about that for 2025. Maybe there's some more headwinds on revenues. I don't know, but how do you feel about the ability to generate positive operating leverage kind of regardless of what happens on the revenue side? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 04, 2025 / 4:20PM, BFH.N - Bread Financial Holdings Inc at RBC Capital Markets Global Financial Institutions Conference

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Any others? Just I wanted to ask, it's been a wild five years in consumer finance and especially for your company. You guys have done a lot of work and maybe this is a better question for a day ago or late last week, but is the hard work done? And are we at an inflection point in your business? You feel like the losses are cresting and it's more of a macro driven outlook for your company at this point or what's left to do?

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Okay. So the message is, feeling good about the way things are going. A little bit of maybe near-term cautiousness or watching closely in terms of the direction of the economy, feel good about reserves and capital. What else?

Question: Jon Arfstrom - RBC Capital Markets - Analyst : Good. Thank you, Perry, appreciate it. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 04, 2025 / 4:20PM, BFH.N - Bread Financial Holdings Inc at RBC Capital Markets Global Financial Institutions Conference