Bread Financial (BFH) Goldman Sachs U.S. Financial Services Conference summary

Strategic focus and operational excellence

• Emphasis on responsible growth, disciplined risk management, and prudent underwriting to navigate the macroeconomic environment into 2026.

• Ability to execute all three capital priorities: investing in the business, maintaining strong balance sheet metrics, and returning value to shareholders.

• Continued reliance on operational excellence and technology investments to drive transformation and efficiency.

• Positive operating leverage achieved through cost management and process improvements.

• AI and digital initiatives are being thoughtfully deployed, focusing on customer service, fraud management, and regulatory compliance.

Consumer trends and credit performance

• Consumers have shown resilience, with spending patterns shifting toward discretionary and non-discretionary items depending on risk bands.

• Holiday spending is expected to show low single-digit growth year-over-year, with consumers seeking deals and reverting to pre-pandemic behaviors.

• Credit performance continues to improve, with loss rates expected at the lower end of guidance and further improvement anticipated in 2024.

• Reserve rates are projected to decline toward 10% over the next few years, driven by better credit quality and macro stability.

• Underwriting remains data-driven, with no major loosening expected; growth will be gradual and portfolio quality-focused.

Partnerships and growth pipeline

• Robust pipeline of new partners, with recent wins in the home vertical (Bed Bath & Beyond, Furniture First, Raymour & Flanigan) expected to drive momentum into 2026.

• Focus on both acquiring new partners and retaining top 10 partners, most of whom are contracted through 2028 and beyond.

• Partner renewals increasingly emphasize data analytics, technology, and product innovation over price.

• Expansion of product offerings, including private label, co-brand, BNPL, and installment loans, to meet diverse partner and customer needs.

• Relationship-driven approach differentiates from transactional competitors, fostering deeper engagement and loyalty.