Bread Financial Holdings Inc (BFH) 2022 Q4 法說會逐字稿

Good morning, and welcome to Bread Financial's Fourth Quarter Earnings Conference Call. My name is Charlie and I'll be coordinating your call today. (Operator Instructions) It's now my pleasure to introduce Mr. Brian Vereb, Head of Investor Relations at Bread Financial. The floor is yours.

早上好，歡迎來到 Bread Financial 的第四季度收益電話會議。我叫查理，今天我將負責協調您的來電。 （操作員說明）現在我很高興介紹 Bread Financial 投資者關係主管 Brian Vereb 先生。地板是你的。

Thank you. A copy of the slides we will be reviewing and the earnings release can be found on the Investor Relations section of our website. On the call today, we have Ralph Andretta, President and Chief Executive Officer of Bread Financial; and Perry Beberman, Executive Vice President and Chief Financial Officer of Bread Financial.

謝謝。我們將審查的幻燈片副本和收益發布可以在我們網站的投資者關係部分找到。 Bread Financial 總裁兼首席執行官 Ralph Andretta 出席了今天的電話會議； Bread Financial 執行副總裁兼首席財務官 Perry Beberman。

Before we begin, I would like to remind you that some of the comments made on today's call and some of the responses to your questions may contain forward-looking statements. These statements are based on management's current expectations and assumptions and are subject to the risks and uncertainties described in the company's earnings release and other filings with the SEC. Also on today's call, our speakers will reference certain non-GAAP financial measures, which we believe will provide useful information for investors. Reconciliation of those measures to GAAP are included in our quarterly earnings materials posted on our Investor Relations website at breadfinancial.com.

在我們開始之前，我想提醒您，在今天的電話會議上發表的一些評論和對您問題的一些答复可能包含前瞻性陳述。這些陳述基於管理層當前的預期和假設，並受到公司收益發布和向美國證券交易委員會提交的其他文件中描述的風險和不確定性的影響。同樣在今天的電話會議上，我們的發言人將提及某些非 GAAP 財務指標，我們相信這些指標將為投資者提供有用的信息。這些措施與 GAAP 的對賬包含在我們的投資者關係網站 breadfinancial.com 上發布的季度收益材料中。

With that, I would like to turn the call over to Ralph Andretta.

有了這個，我想把電話轉給 Ralph Andretta。

Thank you, Brian, and good morning to everyone joining the call. We set ambitious goals in 2022, and I'm extremely proud of our associates for moving our company forward by executing on our initiatives to achieve these goals. I'll begin on Slide 3, which highlights several major accomplishments achieved in 2022 as part of our ongoing business transformation. To begin, we rebranded from Alliance Data Systems to Bread Financial, a tech-forward financial services company providing simple, personalized payment, lending and saving solutions to consumers. Following our multiyear corporate transformation, Bread Financial has emerged as a more modern, nimble and streamlined company backed by leading technology and custom platform solutions that empower today's consumer. Coinciding with our rebrand, we launched our direct-to-consumer Bread Cashback, American Express credit card and we branded our buy now, pay later platform to Bread Pay, which all is installment lending and split pay solutions to an omnichannel approach.

謝謝你，布賴恩，早上好所有參加電話會議的人。我們在 2022 年設定了雄心勃勃的目標，我為我們的員工通過執行我們實現這些目標的舉措推動公司向前發展而感到非常自豪。我將從幻燈片 3 開始，它強調了 2022 年作為我們正在進行的業務轉型的一部分取得的幾項主要成就。首先，我們從 Alliance Data Systems 更名為 Bread Financial，這是一家技術領先的金融服務公司，為消費者提供簡單、個性化的支付、借貸和儲蓄解決方案。經過多年的企業轉型，Bread Financial 已成為一家更現代、更靈活、更精簡的公司，以領先的技術和定制平台解決方案為後盾，為當今的消費者提供支持。在品牌重塑的同時，我們推出了直接面向消費者的 Bread Cashback、美國運通信用卡，並將我們的“立即購買、稍後支付”平台品牌化為 Bread Pay，所有這些都是分期貸款和全渠道分期支付解決方案。

We also rebranded our retail deposit platform to bread savings. These enhanced products provide industry-leading benefits and complement our existing suite of financial offerings, ensuring our customers across generational segments have access to payment and saving solutions. We continue to sign new iconic brand partners, including AAA and the NFL, while renewing valued long-term relationships like Victoria's Secret. We have secured renewals with brand partners representing approximately 85% of our year-end 2022 credit card balances through 2025 after adjusting for the anticipated sale of the BJ's portfolio. We also saw success with de novo program launches in 2022, such as B&H Photo, which exceeded our initial performance and growth projections for the year.

我們還將我們的零售存款平台更名為麵包儲蓄。這些增強型產品提供了行業領先的優勢，並補充了我們現有的金融產品組合，確保我們各代客戶都能獲得支付和儲蓄解決方案。我們繼續與包括 AAA 和 NFL 在內的新標誌性品牌合作夥伴簽約，同時續簽維多利亞的秘密等重要的長期合作關係。在針對 BJ 投資組合的預期銷售進行調整後，我們已與品牌合作夥伴續約，約占我們 2022 年底信用卡餘額的 85% 到 2025 年。我們還看到 2022 年從頭啟動的計劃取得了成功，例如 B&H Photo，這超出了我們當年的初步業績和增長預測。

We look forward to working with our new and existing brand partners to drive incremental sales growth and customer loyalty through our sophisticated data and analytics capabilities, enhanced value propositions and comprehensive product suite. In 2022, we invested more than $125 million in technology modernization, digital advancement, marketing and product innovation. Major achievements included transitioning our credit card processing services to Fiserv, converting to the cloud and integrating Alvaria a state-of-the-art solution that enhances productivity of our customer care and collections efforts.

我們期待與我們新的和現有的品牌合作夥伴合作，通過我們先進的數據和分析能力、增強的價值主張和全面的產品套件來推動增量銷售增長和客戶忠誠度。 2022 年，我們在技術現代化、數字化進步、營銷和產品創新方面投資超過 1.25 億美元。主要成就包括將我們的信用卡處理服務轉移到 Fiserv，轉換到雲並將 Alvaria 集成到最先進的解決方案中，從而提高我們客戶服務和收款工作的效率。

Our digital advancement continued to progress as well as we expanded mobile and web-based customer servicing capabilities and launched a virtual card with web to wallet provisioning to provide our customers a more simplified user experience. These upgrades supported our transformation, enhanced our strategic differentiation and are essential to driving operating efficiency and innovation. We remain committed to ongoing technology investment with a focus on further digital advancement. As part of our investments, we increased our marketing investment in 2022 to bolster spend through joint marketing campaigns with our brand partners.

我們的數字化進程繼續取得進展，同時我們擴展了移動和基於網絡的客戶服務能力，並推出了帶有網絡到錢包配置的虛擬卡，為我們的客戶提供更簡化的用戶體驗。這些升級支持我們的轉型，增強了我們的戰略差異化，對於推動運營效率和創新至關重要。我們仍然致力於持續的技術投資，重點是進一步的數字化進步。作為我們投資的一部分，我們在 2022 年增加了營銷投資，以通過與品牌合作夥伴的聯合營銷活動來增加支出。

Developing strong collaborative relationships with our partners has underpinned our decades of successful growth as these investments build loyalty with both our partners and their customers as well as expand sales opportunities. Additionally, by leveraging our sophisticated data and analytics capabilities and efficient targeting channels, we were successful in driving new acquisition and engagement with our Bread Cashback, American Express Credit Card, Bread Pay and Bread Savings offerings. We will continue to invest for the future to deliver value for our brand partners, customers and shareholders.

與我們的合作夥伴建立牢固的合作關係是我們數十年來成功發展的基礎，因為這些投資建立了我們對合作夥伴及其客戶的忠誠度，並擴大了銷售機會。此外，通過利用我們複雜的數據和分析能力以及高效的目標渠道，我們成功地推動了新的收購和參與我們的 Bread Cashback、美國運通信用卡、Bread Pay 和 Bread Savings 產品。我們將繼續投資未來，為我們的品牌合作夥伴、客戶和股東創造價值。

Finally, I'm proud to announce that Bread Financial was recognized for our prioritization of environmental, social and governance across our entire business, earning a spot on Newsweek's 2023 list of America's most responsible companies. Our commitment to advancing our ESG strategy, objectives and accountability is evident with the organization and remains core to our sustainable business practices.

最後，我很自豪地宣布，Bread Financial 因我們在整個業務中優先考慮環境、社會和治理而獲得認可，並在《新聞周刊》2023 年美國最負責任的公司名單中贏得了一席之地。我們對推進我們的 ESG 戰略、目標和問責制的承諾在組織中是顯而易見的，並且仍然是我們可持續業務實踐的核心。

Turning to Slide 4. We are pleased to have achieved our 2022 financial targets, driven by organic growth from our existing brand partners as well as addition of our new brand partners and product offerings. Average loans grew 13% compared to 2021, revenue growth exceeded average loan growth at 17% year-over-year. Pretax pre-provision earnings increased 19% versus 2021, highlighting the quality of the growth we are generating and the underlying value we are creating. We remain disciplined generating more than 200 basis points of positive operating leverage for the year as we manage our expenses in alignment with our revenue and growth outlook while continuing to invest in our future.

轉到幻燈片 4。我們很高興實現了 2022 年的財務目標，這得益於我們現有品牌合作夥伴的有機增長以及我們新品牌合作夥伴和產品的增加。與 2021 年相比，平均貸款增長 13%，收入增長超過平均貸款增長 17%。與 2021 年相比，稅前撥備前收益增長了 19%，凸顯了我們正在創造的增長質量和我們正在創造的潛在價值。由於我們根據收入和增長前景管理費用，同時繼續投資於我們的未來，因此我們保持紀律性，在這一年產生了超過 200 個基點的積極經營槓桿。

Our net loss rate of 5.4% remain within our full year guidance range and below our historic average of approximately 6%. Along with accomplishing our 2022 targets, we significantly strengthened our balance sheet and bolstered our financial resilience through greater product and funding diversification. We increased loss absorption capacity and growth in capital and tangible book value. Retail deposits on our Bread savings platform increased to $5.5 billion or 72% year-over-year. We plan to build on these achievements in 2023 through continued execution of our long-term strategy.

我們 5.4% 的淨虧損率保持在我們的全年指導範圍內，低於我們約 6% 的歷史平均水平。在實現 2022 年目標的同時，我們還通過產品和資金多元化顯著加強了資產負債表並增強了財務彈性。我們提高了損失吸收能力以及資本和有形賬面價值的增長。我們麵包儲蓄平台上的零售存款增加到 55 億美元，同比增長 72%。我們計劃通過繼續執行我們的長期戰略，在 2023 年取得這些成就的基礎上再接再厲。

Moving to Slide 5. I'll highlight some of our most recent business development success. I am pleased to announce that we have signed a new long-term credit card relationship with Hard Rock International, a well-recognized hotel, casino and restaurant operator. Hard Rock attracts a broad demographic given its diverse offerings, further expanding our reach across generations. We will offer Hard Rock customers a new way to pay, while incenting loyalty and brand affinity through our co-brand credit card. During the quarter, we announced a new agreement with the New York Yankees. This exciting relationship rewards Yankees fans for their purchase and provides enhanced benefits to our New York Yankees co-brand credit card, while further diversifying our brand partner base.

轉到幻燈片 5。我將重點介紹我們最近的一些業務發展成功案例。我很高興地宣布，我們已經與知名酒店、賭場和餐廳運營商 Hard Rock International 簽署了新的長期信用卡合作關係。 Hard Rock 憑藉其多樣化的產品吸引了廣泛的人群，進一步擴大了我們在幾代人中的影響力。我們將為 Hard Rock 客戶提供一種新的支付方式，同時通過我們的聯合品牌信用卡提高忠誠度和品牌親和力。在本季度，我們宣布了與紐約洋基隊的新協議。這種激動人心的關係獎勵洋基隊球迷的購買，並為我們的紐約洋基隊聯名信用卡提供更多優惠，同時進一步豐富我們的品牌合作夥伴基礎。

Also during the fourth quarter, we signed a multiyear renewal with long-term partner Helzberg Diamonds, underscoring our strong market share position in the jewelry space. Helzberg Diamonds has more than 100 years of diamond expertise and operates online at over 200 stores nationwide. We will continue to leverage our advanced data and analytics to enhance the shopping experience to Helzberg's customers.

同樣在第四季度，我們與長期合作夥伴 Helzberg Diamonds 簽署了多年續約協議，凸顯了我們在珠寶領域的強大市場份額地位。 Helzberg Diamonds 擁有 100 多年的鑽石專業知識，並在全國 200 多家在線商店開展業務。我們將繼續利用我們先進的數據和分析來提升 Helzberg 客戶的購物體驗。

Turning to Bread Pay. We continue to add new brand partners to our platform. And importantly, we have now extended nearly 50% of our current loan origination volume with new long-term renewals. Because these contracts historically have been short-term in nature, having long-term extensions will reduce volatility and promote long-term sustainable growth. Additionally, our strategic relationship with Sezzle continued to outpace our expectations with now more than 200 live merchants and installment loan origination volume exceeding our initial goal. We are pleased with our many accomplishments in 2022 and plan to build on this momentum in 2023. Our business development pipeline remains strong, and we are confident in our ability to grow responsibly in 2023 despite a more challenging macroeconomic landscape. As always, we remain vigilant in responsibly driving sustainable profitable growth.

轉向麵包支付。我們繼續為我們的平台添加新的品牌合作夥伴。重要的是，我們現在已經通過新的長期續約擴大了當前貸款發放量的近 50%。由於這些合同在歷史上都是短期的，長期延期將減少波動並促進長期可持續增長。此外，我們與 Sezzle 的戰略關係繼續超出我們的預期，現在有超過 200 家在線商家和分期貸款發放量超過了我們最初的目標。我們對 2022 年取得的諸多成就感到高興，併計劃在 2023 年繼續保持這一勢頭。我們的業務發展渠道依然強勁，儘管宏觀經濟形勢更具挑戰性，但我們有信心在 2023 年實現負責任的增長。一如既往，我們在負責任地推動可持續盈利增長方面保持警惕。

Perry will outline our specific 2023 financial targets, which include continued strategic investments aligned with quality and revenue quality loan and revenue growth. Our 2023 outlook assumes continued inflationary pressures and gradually rising unemployment levels. Headwinds that we expect will result in a full year net loss rate above our long-term historic average of approximately 6%. This corresponds with our expectations that net loss rate will hover above our historic average during more challenging economic periods and drop below our historic average during more favorable economic periods.

Perry 將概述我們 2023 年的具體財務目標，其中包括與質量和收入質量貸款和收入增長相一致的持續戰略投資。我們的 2023 年展望假設通脹壓力持續存在且失業率逐漸上升。我們預計的逆風將導致全年淨虧損率高於我們約 6% 的長期歷史平均水平。這符合我們的預期，即在更具挑戰性的經濟時期淨虧損率將徘徊在我們的歷史平均水平之上，而在更有利的經濟時期將低於我們的歷史平均水平。

With 3 decades of experience, our differentiated and tested underwriting and credit risk modeling is purposely structured to navigate the full range of economic scenarios, focused on producing positive annual earnings and a strong risk reward margin even during periods of economic stress. With the changes we have made over the past 3 years to strengthen our credit profile, we remain confident in our long-term guidance of the through-the-cycle average net loss rate below our historic average of 6%. Our seasoned leadership team is experienced in managing through credit cycles, and every cycle is different. Some factors like inflation are impacting all consumers and cannot be fully controlled or mitigated.

憑藉 3 年的經驗，我們差異化和經過測試的承保和信用風險模型經過專門構建，可以駕馭各種經濟情景，即使在經濟壓力時期也能專注於產生正的年收益和強大的風險回報率。鑑於我們在過去 3 年中為加強信用狀況所做的改變，我們對整個週期平均淨虧損率低於歷史平均水平 6% 的長期指引充滿信心。我們經驗豐富的領導團隊在管理信貸週期方面經驗豐富，每個週期都不同。通貨膨脹等一些因素正在影響所有消費者，無法完全控製或緩解。

We will manage what we can control. In these instances, we run our business with a long-term focus as we have done effectively in previous downturns. We have and will continue to proactively adjust our underwriting and credit line management to account for the anticipated challenges faced by consumers. We manage our business with strong governance and controls intact -- and remain aligned and confident on our objective to deliver long-term value for our stakeholders.

我們將管理我們可以控制的事情。在這些情況下，我們以長期為重點開展業務，就像我們在之前的經濟低迷時期所做的那樣。我們已經並將繼續積極調整我們的承保和信貸額度管理，以應對消費者面臨的預期挑戰。我們通過強有力的治理和完好無損的控制來管理我們的業務——並且對我們為利益相關者提供長期價值的目標保持一致和自信。

With that, I will turn it over to Perry Beberman, our CFO, to review the financials.

有了這個，我將把它交給我們的首席財務官佩里貝伯曼來審查財務狀況。

Thanks, Ralph. Slide 6 provides our fourth quarter financial highlights. Bread Financial's credit sales were up 16% year-over-year from $10.2 billion. Average and end-of-period loans were each up 23%, driven by our new program additions as well as new products and organic growth from existing brand partners. Revenue for the quarter was $1 billion, increasing 21% versus the fourth quarter of 2021 resulted from higher average loan balances and improved loan yields, while total noninterest expenses increased 28% as anticipated.

謝謝，拉爾夫。幻燈片 6 提供了我們第四季度的財務亮點。 Bread Financial 的信貸銷售額從 102 億美元同比增長 16%。平均貸款和期末貸款分別增長 23%，這主要受我們新增計劃以及新產品和現有品牌合作夥伴有機增長的推動。本季度收入為 10 億美元，比 2021 年第四季度增長 21%，原因是平均貸款餘額增加和貸款收益率提高，而非利息支出總額如預期增長 28%。

As we signaled previously, EPS was materially impacted this quarter by the higher provision for credit losses, reflecting seasonal loan growth in the quarter, coupled with the required upfront CECL reserve build from the acquisition of the approximately $1.5 billion AAA loan portfolio.

正如我們之前所暗示的那樣，本季度每股收益受到信貸損失準備金增加的重大影響，反映了本季度的季節性貸款增長，以及收購約 15 億美元的 AAA 貸款組合所需的前期 CECL 準備金。

Turning to Slide 7. I'll review our full year 2022 financial highlights. Bread Financial Credit sales were up 11% year-over-year to $32.9 billion, and average loans increased 13%. Revenue for the year was $3.8 billion, an increase of 17% compared to 2021, while total noninterest expenses increased 15%, driven by portfolio growth, inflation and ongoing investments in technology modernization, digital advancement, marketing and product innovation, as Ralph discussed earlier.

轉到幻燈片 7。我將回顧我們 2022 年全年的財務亮點。 Bread Financial Credit 銷售額同比增長 11% 至 329 億美元，平均貸款增長 13%。今年收入為 38 億美元，與 2021 年相比增長 17%，而非利息支出總額增長 15%，這主要受投資組合增長、通貨膨脹以及對技術現代化、數字化進步、營銷和產品創新的持續投資的推動，正如 Ralph 之前討論的那樣.

Income from continuing operations was $224 million and diluted EPS from continuing operations was $4.47 for the year, both of which were materially impacted by the higher provision for credit losses in the year as a result of our strong loan growth, portfolio acquisitions and a higher reserve rate.

全年來自持續經營業務的收入為 2.24 億美元，來自持續經營業務的攤薄每股收益為 4.47 美元，這兩者都受到由於我們強勁的貸款增長、投資組合收購和更高的準備金而導致的當年信貸損失準備金增加的重大影響速度。

Looking at the financials in more detail on Slide 8. Total interest income was up 30% from the fourth quarter of 2021, resulting from 23% higher average loan balances, coupled with improved loan yields. Noninterest income, which primarily includes merchant discount fees and interchange revenue, net of the impact from our retailer share agreements and customer awards was negative $97 million.

在幻燈片 8 上更詳細地查看財務數據。總利息收入比 2021 年第四季度增長了 30%，這是由於平均貸款餘額增加了 23%，同時貸款收益率也有所提高。非利息收入，主要包括商家折扣費和交換收入，扣除我們的零售商股份協議和客戶獎勵的影響後為負 9700 萬美元。

Total noninterest expenses increased 28% from fourth quarter of 2021, driven by 3 primary factors. First, card and processing expenses related to incremental card issuance volume; second, information process and communication expense as a result of the transition of our credit card processing services and other software licensing expenses; and third, higher employee compensation and benefit costs. Additional details on expense drivers can be found in the appendix of the slide deck. Overall, income from continuing operations was down $195 million for the quarter versus the fourth quarter of 2021 as the improvement in pretax pre-provision earnings, or PPNR was offset by a higher provision for credit losses in the quarter, including the previously discussed upfront CECL reserve impact from the AAA portfolio acquisition in the quarter.

在 3 個主要因素的推動下，非利息支出總額比 2021 年第四季度增長了 28%。一是與增量發卡量相關的卡費及手續費；第二，由於我們的信用卡處理服務和其他軟件許可費用的過渡而產生的信息處理和通信費用；第三，更高的員工薪酬和福利成本。有關費用驅動因素的更多詳細信息，請參見幻燈片的附錄。總體而言，本季度持續經營收入較 2021 年第四季度下降 1.95 億美元，原因是稅前撥備前收益或 PPNR 被本季度較高的信貸損失撥備所抵消，包括之前討論的前期 CECL本季度 AAA 投資組合收購對儲備的影響。

Taking out the tax and provision impacts, we are pleased to report that our PPNR improved 13% year-over-year, making the -- marking the seventh consecutive quarter that we have generated year-over-year double-digit growth in PPNR. As we have said, we remain focused on making responsible decisions to produce quality earnings.

除去稅收和準備金的影響，我們很高興地報告我們的 PPNR 同比增長 13%，這標誌著我們連續第七個季度在 PPNR 中實現了兩位數的同比增長。正如我們所說，我們仍然專注於做出負責任的決定以產生高質量的收益。

Turning to Slide 9. The left side of the slide highlights our earning asset yields and balances. The fourth quarter loan yield increased 80 basis points year-over-year driven by the increases in the prime rate, but decreased 120 points sequentially due to seasonally higher balances in the quarter, the addition of the lowering yield, higher-quality AAA portfolio and an increase in reversals of interest and fees revenues from higher gross losses. Net interest margin increased 30 basis points to 19.1% year-over-year as the benefit from loan yields more than offset the increase in funding costs.

轉到幻燈片 9。幻燈片的左側突出顯示了我們的盈利資產收益率和余額。第四季度貸款收益率在最優惠利率上升的推動下同比增長 80 個基點，但由於本季度季節性較高的餘額、較低的收益率、較高質量的 AAA 投資組合和總虧損增加導致利息和費用收入的逆轉增加。淨息差同比增長 30 個基點至 19.1%，因為貸款收益率帶來的收益足以抵消融資成本的增加。

On the liability side, we saw funding costs increase in the fourth quarter, in line with our expectations given the Fed interest rate increases through December of 2022. As you can see from the stacked bars on the bottom right, our direct-to-consumer deposits continue to grow and now represent $5.5 billion or 26% of our total interest-bearing liabilities. We expect that our retail deposit balances will continue to increase, providing a stable funding base as retail consumer deposits become an even more meaningful portion of our funding over time.

在負債方面，我們看到第四季度的融資成本增加，這符合我們的預期，因為美聯儲將在 2022 年 12 月之前加息。正如您從右下角的堆疊條中看到的那樣，我們的直接面向消費者的存款繼續增長，現在占我們有息負債總額的 55 億美元或 26%。我們預計我們的零售存款餘額將繼續增加，提供穩定的資金基礎，因為隨著時間的推移，零售消費者存款將成為我們資金中更重要的一部分。

Moving to Slide 10. And starting in the upper left with delinquency rate. The fourth quarter rate of 5.5% was slightly below the third quarter rate following typical seasonality. On the upper right, the net loss rate was 6.3% for the quarter, slightly better than our earlier projection due to lower-than-expected losses in November. The loss rate in December of 6.7% was more in line with our expectations given continued payment rate pressure. If we think about where the consumer is today, we have to look at how we got here. Earlier in 2022, we still saw some of the benefits from the late 2021 stimulus aid coming through in terms of both spend and very strong payment rates. If you look at a trend line from our low point in 3Q '21 to today, you can see the upward movement or normalization of loss rates from both the wind down of stimulus, which has largely run its course and the influence of elevated inflation.

轉到幻燈片 10。從左上角開始顯示拖欠率。受典型的季節性影響，第四季度 5.5% 的增長率略低於第三季度。在右上角，該季度的淨虧損率為 6.3%，由於 11 月份的虧損低於預期，略好於我們之前的預測。鑑於持續的支付率壓力，12 月的損失率為 6.7%，更符合我們的預期。如果我們考慮今天的消費者在哪裡，我們必須看看我們是如何到達這裡的。在 2022 年初，我們仍然看到 2021 年底的刺激援助在支出和非常強勁的支付率方面帶來的一些好處。如果您查看從 21 年第三季度低點到今天的趨勢線，您可以看到由於刺激措施逐漸結束和通貨膨脹率上升的影響，損失率呈上升趨勢或正常化。

We saw lower scoring and lower income cohorts normalized first. However, given the broad impact of inflation, we are seeing impacts across the full credit spectrum and all income groups. As you would expect, we continue to proactively manage risk-reward decisions at the margins for both new account underwriting and existing account line management. This is an ongoing and evolving as the macroeconomic environment unfolds.

我們看到得分較低和收入較低的人群首先正常化。然而，鑑於通貨膨脹的廣泛影響，我們看到了整個信貸範圍和所有收入群體的影響。正如您所期望的那樣，我們將繼續在新賬戶承保和現有賬戶線管理的邊緣主動管理風險回報決策。隨著宏觀經濟環境的展開，這是一個持續和演變的過程。

Moving to the bottom left, the reserve rate increased 10 basis points sequentially from the third quarter to 11.5% as a result of continued elevated inflation, increasing consumer debt levels and weakening macroeconomic indicators, pulling down the base case scenario outlook. This was modestly offset by the addition of the higher quality AAA portfolio and seasonal transactor balance growth in the fourth quarter. Our intention is to maintain a conservative weighting of economic scenarios in our credit reserve model in anticipation of the increase in macroeconomic challenges and the expected potential impact on our credit performance metrics.

向左下方移動，準備金率從第三季度開始連續增加 10 個基點至 11.5%，這是由於通脹持續升高、消費者債務水平上升和宏觀經濟指標疲軟，拉低了基本情景前景。這被第四季度更高質量的 AAA 投資組合和季節性交易商餘額增長所適度抵消。我們的目的是在我們的信用儲備模型中保持保守的經濟情景權重，以應對宏觀經濟挑戰的增加以及對我們信用績效指標的預期潛在影響。

We estimate that our reserve rate could increase up to approximately 100 basis points due to the continued macroeconomic trends, seasonality and the impact from the anticipated sale of the better credit quality BJ's portfolio. In nominal dollar terms, we would expect a meaningful decrease in our allowance balance and therefore, a provision for credit losses released in early 2023, again, due to the anticipated sale of the BJ's portfolio as well as projected seasonal decline in loan balances from year-end.

我們估計，由於持續的宏觀經濟趨勢、季節性以及預期出售信用質量更好的 BJ 投資組合的影響，我們的準備金率可能會增加約 100 個基點。以名義美元計算，我們預計我們的準備金餘額將大幅減少，因此，由於 BJ 投資組合的預期出售以及貸款餘額預計從 2023 年開始的季節性下降，我們將在 2023 年初釋放信貸損失準備金-結尾。

Our credit distribution improved from the third quarter with economic consumer headwinds offset by the benefit from the AAA portfolio acquisition. We would expect our overall portfolio -- our overall proportion of 660-plus Vantage score customers to move down when we exit the BJ's portfolio. A fundamental element built into our business model includes having controls in place to manage our risk tolerance with the objective of ensuring that we are properly compensated for the risk we take to underwrite and manage our portfolio.

我們的信貸分配從第三季度開始有所改善，經濟消費者逆風被 AAA 投資組合收購帶來的好處所抵消。當我們退出 BJ 的投資組合時，我們預計我們的整體投資組合——我們 660 多分 Vantage 評分客戶的整體比例會下降。我們的業務模型中內置的一個基本要素包括制定控制措施來管理我們的風險承受能力，目的是確保我們為承保和管理我們的投資組合所承擔的風險得到適當的補償。

We closely monitor our projected returns with the expectation that we generate strong risk-adjusted margin above peer levels. As Ralph alluded to previously, we remain confident as a management team in our ability to manage for credit risk and drive sustainable, profitable growth through the full economic cycle.

我們密切關注我們的預期回報，期望我們產生高於同行水平的強勁風險調整利潤率。正如拉爾夫之前提到的那樣，作為一個管理團隊，我們仍然對我們在整個經濟周期中管理信用風險和推動可持續盈利增長的能力充滿信心。

Slide 11 provides our financial outlook for the full year 2023. For the full year, average loans are expected to grow in the mid-single-digit range relative to 2022. Our expectation includes projected new and renewed business announcements, visibility into our pipeline, the anticipated sale of the BJ's portfolio and our current economic outlook.

幻燈片 11 提供了我們對 2023 年全年的財務展望。與 2022 年相比，全年平均貸款預計將在中等個位數範圍內增長。我們的預期包括預計新的和更新的業務公告、我們管道的可見性、 BJ 投資組合的預期出售以及我們當前的經濟前景。

The range is contingent on credit strategy actions that will lever on macroeconomic conditions. We expect revenue growth to be consistent with average loan growth in 2023, excluding the anticipated gain on sale with a full year net interest margin similar to 2022 full year rate of 19.2%. The first quarter NIM is expected to be below our full year guidance given the inclusion of the lower loan yield BJ's portfolio and a larger headwind from the reversal of billed interest and fees related to expected elevated first quarter credit losses.

該範圍取決於將利用宏觀經濟條件的信貸戰略行動。我們預計收入增長將與 2023 年的平均貸款增長保持一致，不包括全年淨息差與 2022 年全年 19.2% 相似的預期銷售收益。考慮到 BJ 的投資組合較低的貸款收益率以及與預期的第一季度信貸損失增加相關的計費利息和費用逆轉帶來的更大阻力，預計第一季度 NIM 將低於我們的全年指導。

Our outlook assumes additional interest rate increase by the Federal Reserve will result in a nominal benefit to total net interest income. We expect to deliver nominal positive operating leverage in 2023, excluding anticipated gain on sale. As Ralph highlighted, we will continue to strategically invest in our business to fuel growth opportunities and create operating efficiencies while balancing these investments with responsible revenue growth in order to achieve sustainable profitable growth. First quarter 2023 total expenses are projected to be sequentially down from the fourth quarter of 2022, benefiting from seasonally lower transaction volume and lower marketing expenses.

我們的展望假設美聯儲進一步加息將對淨利息收入總額產生名義上的好處。我們預計將在 2023 年實現名義上的正經營槓桿，不包括預期的銷售收益。正如拉爾夫強調的那樣，我們將繼續對我們的業務進行戰略投資，以推動增長機會並提高運營效率，同時平衡這些投資與負責任的收入增長，以實現可持續的盈利增長。受益於季節性較低的交易量和較低的營銷費用，預計 2023 年第一季度的總支出將比 2022 年第四季度環比下降。

At this time, from a dollar perspective, we expect the second half 2023 total expenses to be flat to down from the first half of the year, driven by lower intangible amortization expenses and improved operating efficiencies related to our technology modernization efforts. We anticipate the full year 2023 net loss rate will be approximately 7%. As you can imagine, there is a broad range of outcomes for net charge-offs for the year based on potential economic scenarios.

目前，從美元的角度來看，我們預計 2023 年下半年的總支出將與上半年持平或下降，這是由於無形攤銷支出減少以及與我們的技術現代化工作相關的運營效率提高所致。我們預計 2023 年全年淨虧損率約為 7%。正如您所想像的，根據潛在的經濟情景，今年的淨沖銷結果範圍很廣。

Given persistent inflation and rising interest rates, borrowers are making decisions to pull back on discretionary spend and drawing down on savings, pressuring their ability to pay. Despite low unemployment, moderate income households are increasingly noting payment difficulties during the collections process. Our outlook assumes inflation remains elevated and that these pressures will persist throughout 2023.

鑑於持續的通貨膨脹和不斷上升的利率，借款人正在決定減少可自由支配的支出並減少儲蓄，從而給他們的支付能力帶來壓力。儘管失業率較低，但中等收入家庭越來越多地註意到收款過程中的付款困難。我們的展望假設通脹仍處於高位，並且這些壓力將持續到 2023 年。

At the same time, our outlook contemplates a gradual increase in the unemployment rate in 2023. We will continue to closely monitor macroeconomic indicators as we gain clarity on the Fed's efforts to tamp down inflation. We'll update our expectations accordingly. We expect the first half 2023 loss rates to trend upward given the current inflationary pressures as well as the impact of the sale of the BJ's portfolio.

與此同時，我們的展望預計 2023 年失業率將逐步上升。隨著美聯儲抑制通脹的努力變得清晰，我們將繼續密切關注宏觀經濟指標。我們會相應地更新我們的期望。鑑於當前的通脹壓力以及出售 BJ 投資組合的影響，我們預計 2023 年上半年的損失率將呈上升趨勢。

Our first half net loss rate is projected to be above 7%, inclusive of the impact from the previously discussed customer accommodations we made in the second half of 2022 in connection with the transition of our credit card processing services.

我們上半年的淨虧損率預計將超過 7%，其中包括我們在 2022 年下半年就信用卡處理服務的過渡所做的先前討論的客戶住宿的影響。

Finally, we expect our full year normalized effective tax rate to remain in the range of 25% to 26%, with quarter-over-quarter variability to timing of certain discrete items. Looking forward, we intend to host an analyst event later this year where we will further highlight what we believe are the strategic differentiators and competitive advantages of our business model, including the capital generation potential it creates.

最後，我們預計我們的全年標準化有效稅率將保持在 25% 至 26% 的範圍內，某些離散項目的時間會出現季度環比變化。展望未來，我們打算在今年晚些時候舉辦一次分析師活動，屆時我們將進一步強調我們認為是我們商業模式的戰略差異化因素和競爭優勢，包括它創造的資本產生潛力。

At that time, we plan to provide new long-term financial targets as well as more detail around our capital priorities and capital allocation going forward. Regarding current parent capital levels, our TCE to TA ratio temporarily dropped in the fourth quarter of 2022 due to the timing of the acquisition of the AAA portfolio. Given the anticipated sale of the BJ's portfolio, our TCE to TA ratio is projected to increase to a level above the 3Q '22 figure of 8% after the sale.

屆時，我們計劃提供新的長期財務目標，並圍繞我們未來的資本優先事項和資本配置提供更多細節。關於當前的母公司資本水平，由於收購 AAA 投資組合的時機，我們的 TCE 與 TA 比率在 2022 年第四季度暫時下降。鑑於 BJ 投資組合的預期出售，我們的 TCE 與 TA 比率預計將在出售後增加到高於 22 年第三季度 8% 的水平。

In keeping with our business transformation over the past 3 years, we made strategic decisions to enhance our financial resilience as indicated on Slide 12. We improved our credit quality, product and funding diversification, loss absorption capacity through our loan loss reserve and capital positioning and increased our tangible book value. Our tangible book -- tangible equity plus credit reserve ratio as a percent of loans is up nearly 200 basis points since 2020. Our parent level debt is down more than 33% over the same time period. These enhancements and improvements to our underlying credit portfolio mix strengthen our confidence in our ability to sustain more challenging economic outcomes and outperform our historical results through the entire economic cycle.

為配合過去 3 年的業務轉型，我們制定了增強財務彈性的戰略決策，如幻燈片 12 所示。我們通過貸款損失準備金和資本定位改善了信貸質量、產品和資金多元化、損失吸收能力以及增加了我們的有形賬面價值。自 2020 年以來，我們的有形賬簿——有形股權加上信貸準備金率佔貸款的百分比上升了近 200 個基點。同期我們的母公司債務下降了 33% 以上。這些對我們基礎信貸組合組合的增強和改進增強了我們對我們在整個經濟周期中維持更具挑戰性的經濟成果並超越我們歷史成果的能力的信心。

Our experienced team will continue to manage our portfolio proactively. We're utilizing our recession readiness playbook for both new and existing accounts with a heightened focus on open-to-buy authorizations and helping consumers manage their credit lines and balances in a healthy manner. We believe that our improved risk profile, coupled with our more diverse portfolio and brand partner base, make us better positioned than ever to manage through a recessionary period. We look forward to building upon our successes from 2022, and we'll continue to make strategic decisions to create long-term sustainable value for all our stakeholders.

我們經驗豐富的團隊將繼續主動管理我們的投資組合。我們正在為新賬戶和現有賬戶使用我們的經濟衰退準備手冊，重點關注開放購買授權，並幫助消費者以健康的方式管理他們的信用額度和余額。我們相信，我們改善的風險狀況，加上我們更多樣化的產品組合和品牌合作夥伴基礎，使我們比以往任何時候都更有能力度過衰退期。我們期待在 2022 年取得成功的基礎上再接再厲，我們將繼續制定戰略決策，為所有利益相關者創造長期可持續價值。

Operator, we are now ready to open the lines for questions.

接線員，我們現在準備打開問題熱線。

(Operator Instructions) Our first question comes from Sanjay Sakhrani of KBW.

（操作員說明）我們的第一個問題來自 KBW 的 Sanjay Sakhrani。

I guess I have some questions on the loss assumptions in the reserve rate. Perry, you talked about the reserve rate possibly going up another 100 basis points in 2023. So I'm just making sure I got this right. So you think by the end of this year, we're probably closer to 12.5% and then the 7% charge-off rate for the year. Can you maybe just separate what the processing conversion impacts are versus sort of the deterioration you're seeing as a result of normalization?

我想我對準備金率的損失假設有一些疑問。佩里，你談到準備金率可能在 2023 年再上升 100 個基點。所以我只是確保我做對了。所以你認為到今年年底，我們可能會接近 12.5%，然後是今年的 7% 的沖銷率。您能否將處理轉換的影響與規範化導致的惡化分開？

Sure. Thanks, Sanjay. So let me start with the reserve rate first. We're always trying to give our best thinking based on our current visibility into our portfolio and the economic landscape. As I mentioned earlier, we expect the rate to increase in 2023, given the sale of BJ's portfolio and potential continued economic weakness. So when BJ's exit, that's going to cause a step up in our reserve rate because today, that's on the portfolio at a lower than the current average that we have.

當然。謝謝，桑傑。所以讓我先從準備金率開始。我們一直在努力根據我們目前對我們的投資組合和經濟前景的了解，給出我們最好的想法。正如我之前提到的，考慮到 BJ 投資組合的出售和潛在的持續經濟疲軟，我們預計利率將在 2023 年上升。因此，當 BJ 退出時，這將導致我們的準備金率上升，因為今天，它在投資組合中的水平低於我們目前的平均水平。

And then you look at the -- I would say that a lot is going to happen in the first quarter, plus then you've got seasonal impacts that can also affect the first quarter. Specifically regarding the risk overlay, I think you guys could see that we are proactive in getting ahead of what we deem to be future potential weakness, which is what the CECL economic risk overlays help us to achieve. And one thing we recognized early on was that all industry loss models have been calibrated historically on changes in unemployment and those unemployment-led recessions.

然後你看看——我想說第一季度會發生很多事情，再加上季節性影響也會影響第一季度。特別是關於風險疊加，我想你們可以看到我們積極主動地領先於我們認為是未來潛在的弱點，這就是 CECL 經濟風險疊加幫助我們實現的目標。我們很早就認識到的一件事是，所有行業損失模型都根據歷史上的失業率變化和失業率導致的衰退進行了校準。

This elevated inflation environment that's currently creating strain on consumers is not what these models are calibrated. So it requires a different degree of judgmental overlays, which is when you hear us talking about, hey, we're leaning into more of those -- more severe scenarios, which for our severe scenarios, the severe has reached an unemployment rate of 7.8% over the next 24 months, (inaudible). And then the severe adverse peaks, it's 8.9%. But I don't think those are realistic outcomes of what's going to happen, but we lean into those for waiting to care for that inflation component.

目前對消費者造成壓力的這種高通脹環境並不是這些模型所校準的。所以它需要不同程度的判斷疊加，當你聽到我們談論時，嘿，我們正在傾向於更多——更嚴重的情景，對於我們的嚴重情景，嚴重的失業率已達到 7.8 % 在接下來的 24 個月內，（聽不清）。然後是嚴重的不利峰值，為 8.9%。但我不認為這些是將要發生的事情的現實結果，但我們傾向於那些等待關注通脹因素的人。

So you can decouple that, say, has a judgmental piece, but then there's also the unemployment. So this is kind of a new environment for these models to care for. So when we get to at the end of this year, we're thinking that we're going to exit the year with a mid- to high 4% range for unemployment. So that's kind of the -- I'm sorry, I get you probably a lot more on that with the reserve rate and then I'll answer the second -- the first part or second part of the 7% loss outlook, that's an increase of 150 to 175 basis points year-over-year. And there's 3 components that are in that, right? There's the macroeconomic pressure that we're seeing in the consumers. And we expect throughout the year, there will be the continued impact of inflation and maybe in the back half of the year that starts to abate, but then you start to pick up some elevated unemployment.

所以你可以解耦，比如說，有一個判斷部分，但還有失業。所以這是一種需要這些模型照顧的新環境。因此，當我們到今年年底時，我們認為我們將以 4% 的中高失業率結束這一年。所以這就是 - 對不起，我可能會讓你了解更多有關準備金率的信息，然後我會回答第二部分 - 7% 損失前景的第一部分或第二部分，這是一個同比增長 150 至 175 個基點。裡面有 3 個組件，對嗎？我們在消費者身上看到了宏觀經濟壓力。我們預計全年，通貨膨脹的影響將持續存在，並且可能在今年下半年開始減弱，但隨後你會開始出現一些高失業率。

Then you also have the second piece in there that's contributing to the increase of 150 to 100 basis points is BJs, which has a lower NCL rate than the rest of the portfolio, that's going to cause a little bit of lift. And then the third piece for us is we do have some trailing conversion relating -- related items that from customer accommodations that was simply the timing of credit losses that would have been in 2022 that are pushing into the first half of '23.

然後你還有第二個有助於增加 150 到 100 個基點的部分是 BJs，它的 NCL 利率低於投資組合的其他部分，這會帶來一點提升。然後對我們來說，第三點是我們確實有一些與客戶住宿相關的尾隨轉換相關項目，這只是 2022 年信貸損失的時間，這些損失正在推進到 23 年上半年。

Are those equally weighted? Or unequal, like is there a more prominent impact from one over the other? Or...

這些權重相等嗎？或者不平等，比如一個人的影響比另一個更突出？或者...

I'd say macro is definitely the more than half.

我會說宏絕對超過一半。

Okay. And just maybe one follow-up question for Ralph. Just on the processing conversion. I'm just curious, are all the residual impacts over at this point, all the kinks ironed out. I'm just wondering if we should think about anything else?

好的。也許只是拉爾夫的一個後續問題。只是在處理轉換上。我只是好奇，此時是否所有的殘餘影響都已結束，所有的問題都已解決。我只是想知道我們是否應該考慮其他事情？

Sanjay, I think a lot of the growing pains are in the rearview mirror. And now we're going to reap the benefits of the -- of why we move quicker to market, better capabilities, less expensive to operate. So unfortunately, we have these things, but I think a lot of that is in our rearview mirror, and we're focused on continuing to stabilize the system and then take use of all of the capabilities that we signed up for.

Sanjay，我認為很多成長的煩惱都在後視鏡中。現在我們將收穫 - 為什麼我們更快地進入市場、更好的能力、更低的運營成本的好處。所以不幸的是，我們有這些東西，但我認為其中很多都在我們的後視鏡中，我們專注於繼續穩定係統，然後利用我們註冊的所有功能。

Our next question comes from Robert Napoli of William Blair.

我們的下一個問題來自威廉·布萊爾的羅伯特·那不勒斯。

Question on your target capital ratio. What do you -- what is -- do you have a formal target? And when do you expect to -- when do you target reaching that target?

關於你的目標資本比率的問題。你 - 什麼是 - 你有正式的目標嗎？你預計什麼時候——你打算什麼時候達到那個目標？

Yes. So what we've been communicating is that we're striving to get to a 9% TCE to TA ratio is a good low end mark. The first priorities of our capital has remained to provide and support profitable growth. And then the second priority is to pay down debt. And we will provide more information about our capital priorities and plans at the investor event later this year.

是的。所以我們一直在傳達的是，我們正在努力達到 9% 的 TCE 與 TA 比率是一個很好的低端標記。我們資本的首要任務仍然是提供和支持盈利增長。然後第二個優先事項是償還債務。我們將在今年晚些時候的投資者活動中提供更多關於我們的資本優先事項和計劃的信息。

I would expect that we wouldn't see buybacks until you hit that or share -- capital return until you hit that target. Is that fair?

我希望在你達到那個目標之前我們不會看到回購，或者在你達到那個目標之前我們不會看到資本回報。這公平嗎？

I don't want to give specifics. But again, our priorities are to support our growth, get our capital levels up and then start to pay down our debt.

我不想給出具體細節。但同樣，我們的首要任務是支持我們的增長，提高我們的資本水平，然後開始償還我們的債務。

And then can you give any color on the competitive environment? There's been a lot of portfolios, obviously, that have changed hands. So you guys have resigned a lot, you've added a lot. What's going on with the competitive environment and the returns that you and your competitors are requiring for deals?

然後你能給競爭環境一些顏色嗎？顯然，有很多投資組合已經易手。所以你們辭了很多，你們加了很多。您和您的競爭對手對交易要求的競爭環境和回報情況如何？

I think no matter what the economy is a competitive environment is always hot to anyone, so that never changes. But when we look at things, we look at things, say, can we grow the portfolio for the partner? Can we do it profitably? And does it contribute to growth for us in a right way? That's how we look at the portfolio. So portfolio has changed and the portfolios we signed and acquired, we have a lot of confidence that we'll grow those portfolios, we'll grow them responsibly and we'll have good, consistent growth.

我認為無論經濟如何，競爭環境對任何人來說總是炙手可熱，所以永遠不會改變。但是，當我們審視事物時，我們會審視事物，例如，我們能否為合作夥伴增加投資組合？我們可以盈利嗎？它是否以正確的方式為我們的成長做出貢獻？這就是我們看待投資組合的方式。所以投資組合發生了變化，我們簽署和收購的投資組合，我們非常有信心我們會發展這些投資組合，我們會負責任地發展它們，我們會有良好、持續的增長。

Our next question comes from Moshe Orenbuch of Crédit Suisse.

我們的下一個問題來自 Crédit Suisse 的 Moshe Orenbuch。

Great. One of the things you talked about a little bit in the prepared remarks is the idea of consumer spending. Could you talk a little bit about how you kind of formed your expectations for receivables growth in terms of what you're seeing in consumer spending and payment rates and how those 2 interact over the course of '23? And I've got a follow-up.

偉大的。您在準備好的發言中談到的其中一件事是消費者支出的想法。你能談談你是如何根據你在消費者支出和支付率上看到的情況以及這兩者在 23 年期間如何相互作用來形成對應收賬款增長的預期的嗎？我有後續行動。

Yes. One nice story, and then I'll ask Perry to chime in. So we saw a good consumer spending and -- we're seeing good consumer spending in January. But given the environment, there is pressure on sales that will offset some of the payment rate improvements. It's just the reality of the macro environment we're going into.

是的。一個很好的故事，然後我會請佩里插話。所以我們看到了良好的消費者支出 - 我們在 1 月份看到了良好的消費者支出。但考慮到環境，銷售壓力將抵消部分支付率的提高。這只是我們要進入的宏觀環境的現實。

Yes. And I'll add on to what Ralph just said, with that context of decelerating spend, consumers making choices within category to deal with the inflation. And then there's a rise in cost of debt overall for them. They're pulling back on spend, so we do contemplate that, coupled with -- you think about elevated losses -- credit losses through the year, that also dampens your growth. So if you're up 1.5% or what you were in the prior year, that impedes growth by 1.5%. And then on top of that, we're being more thoughtful about credit strategies, and we go pull back online and underwriting. So that affects that. And then as well, it may throttle what we do with marketing because the marketing returns look a little different for certain cohorts now. So there's a combination of things that go into our receivables outlook and all those things are contemplated.

是的。我將補充拉爾夫剛才所說的話，在支出減速的背景下，消費者在類別內做出選擇以應對通貨膨脹。然後他們的整體債務成本上升。他們正在縮減開支，所以我們確實考慮到這一點，再加上——你會想到損失增加——全年的信貸損失，這也會抑制你的增長。因此，如果你上漲了 1.5% 或你在前一年的水平，那就阻礙了 1.5% 的增長。然後最重要的是，我們對信貸策略更加周到，我們撤回在線和承銷。所以這會影響。然後，它也可能會限制我們在營銷方面所做的工作，因為現在某些群體的營銷回報看起來有點不同。因此，我們的應收賬款展望中包含多種因素，所有這些因素都在考慮之中。

And the last thing I'll say is our book is changing and with the spend shift to bond discretionary to essential. Years ago, we wouldn't have been able to catch that because we didn't have the products. We now have the products and co-brands and buy now, pay later and other things that are and direct-to-consumer, we're catching just general spend that we wouldn't have bought that before, brand launches and new products are going to also help us drive sales growth over the course of the next year.

我要說的最後一件事是我們的書正在發生變化，隨著支出從可自由支配的債券轉變為必不可少的債券。多年前，我們不可能抓住它，因為我們沒有產品。我們現在有產品和聯合品牌，現在購買，以後付款和其他直接面向消費者的東西，我們只是抓住了我們以前不會購買的一般支出，品牌發布和新產品是還將幫助我們推動明年的銷售增長。

Great. And as a follow-up, you mentioned kind of an unemployment outlook of 4.5% to upper 4s. How do you think about the variability around that if unemployment is either better or worse than that? And as we sort of think about the economic performance over the -- just beyond '23 as well.

偉大的。作為後續行動，您提到了 4.5% 至上 4 的失業率前景。如果失業率比這更好或更糟，您如何看待周圍的可變性？當我們考慮 23 年後的經濟表現時。

Yes, unemployment is always a leading indicator of credit worthiness. So if the rate is better, we would expect credit to perform a little bit better. Obviously, if the rate is worse, we would expect it to perform worse. But we don't expect a spike in 2023. I think we're feeling what we've forecasted, we feel that is where that's an exit rate for '23 that will impact.

是的，失業率始終是信用價值的領先指標。因此，如果利率更好，我們預計信貸表現會更好一些。顯然，如果利率更差，我們預計它的表現會更差。但我們預計 2023 年不會出現飆升。我認為我們感受到了我們的預測，我們認為這就是 23 年的退出率會產生影響的地方。

Our next question comes from Vincent Caintic of Stephens.

我們的下一個問題來自 Stephens 的 Vincent Caintic。

I wanted to ask about late fees. So 2-part question. The main one being just your overall thoughts about that given potential regulation that might challenge late fees. So just your thoughts on what the potential impact is and how you can kind of maybe move around that. And then a follow-up question is, so saw that this quarter, part of the yield decline quarter-over-quarter was from the reversals of interest and fees. So just wondering if you might be able to quantify that and what are your thoughts on that for 2023?

我想問一下滯納金。所以兩部分的問題。主要的一個只是您對可能挑戰滯納金的給定潛在監管的總體想法。因此，只是您對潛在影響的想法以及您可以如何解決這個問題。然後是一個後續問題，因此看到本季度收益率環比下降的部分原因是利息和費用的逆轉。所以只是想知道你是否能夠量化它，你對 2023 年有何看法？

Yes. It wouldn't be an analyst call without the question about late fees. So I'm happy to address it. I look at this as no different than Card Act. The industry was able to adjust. We adjust it accordingly, and we'll read into any regulation that is out there and just curving around this. I will say that as we think about late fees and any other regulatory changes, we have the ability to work with our brand partners to negotiate -- renegotiate terms if that's appropriate. And there's other leverage to pull. So that's -- we'll adjust accordingly just as we do with Card Act. Perry, you want to take the second?

是的。如果沒有關於滯納金的問題，就不會是分析師電話。所以我很樂意解決這個問題。我認為這與 Card Act 沒有什麼不同。該行業能夠進行調整。我們會相應地對其進行調整，我們將閱讀現有的任何法規，並圍繞這一點進行調整。我要說的是，當我們考慮滯納金和任何其他監管變化時，我們有能力與我們的品牌合作夥伴進行談判——如果合適的話，重新談判條款。還有其他槓桿作用。這就是——我們將相應地進行調整，就像我們對 Card Act 所做的那樣。佩里，你想拿第二個嗎？

Yes. So as it relates to net interest margin, which is where late fees reside for us, when we see some delinquency increasing, you see the late fees materialize in net interest margin early and then when the delinquency manifests itself into elevated charge-offs, the reversal of some of those interest and fees occur in that period. So if you have a period where you're going to be above 7%, which is what we've indicated for the first half, you should expect that you're going to have some more reversal of interest and fees impacting that quarter relative to the prior quarter where losses were lower and you had less interest and fee reversal, so you actually had a little bit higher net interest margin.

是的。因此，由於它與淨息差有關，這對我們來說是滯納金所在，當我們看到一些拖欠增加時，你會看到滯納金早早地在淨息差中實現，然後當拖欠本身表現為更高的沖銷時，其中一些利息和費用的逆轉發生在那個時期。因此，如果您有一段時間將超過 7%，這是我們在上半年指出的，您應該預計您將有更多的利息和費用逆轉影響該季度相對上一季度虧損較低，利息和費用逆轉較少，因此淨息差實際上略高。

So that's going to be the dynamic throughout the year, and that's normal when you're going through periods of rising and falling delinquency and then the charge-off follow-up.

所以這將是全年的動態，當你經歷拖欠率上升和下降的時期，然後是註銷跟進時，這是正常的。

(Operator Instructions) Our next question comes from Jeff Adelson of Morgan Stanley.

（操作員說明）我們的下一個問題來自摩根士丹利的傑夫阿德爾森。

Perry, I just wanted to dig into the new loss guide. I think a lot of your competitors are still at or below their cycle averages and you're not guiding to something that's above that. I know we've got the noise coming through the portfolio, but you talked about some of the changes you've made over the past 3 years, how you've kind of enhanced the credit profile of that book. Just wondering what gives you confidence that that's going to drop back down to a below 6% level by the end of this year after this year?

佩里，我只是想深入了解新的損失指南。我認為您的許多競爭對手仍處於或低於其周期平均水平，而您並沒有指導高於該水平的事情。我知道我們在投資組合中聽到了噪音，但你談到了過去 3 年你所做的一些改變，你是如何提高那本書的信用狀況的。只是想知道是什麼讓您有信心在今年年底前回落到 6% 以下的水平？

So I'm going to make sure I heard the question correctly. I think there's 2 parts. One is, why are we guiding higher? I mean I think our -- the increase in basis points is probably in line with what we're hearing across the board. What we're seeing with our portfolio is we did normalize faster. And it's simply -- every company has a different composition of its portfolio. We're more a full-spectrum lender. And as we communicated well over a year ago, we expected normalization to occur faster in our portfolio as consumers use their stimulus early and then that would start -- and they would normalize faster. And that has happened. And then as you mentioned, we do have some noise in our numbers because of the BJ's departing and then some trailing impacts of timing of losses from customer accommodations that we did.

所以我要確保我沒聽錯問題。我認為有 2 個部分。一是，我們為什麼要指導更高？我的意思是我認為我們的 - 基點的增加可能與我們全面聽到的一致。我們在投資組合中看到的是我們確實更快地實現了正常化。很簡單——每家公司的投資組合都有不同的構成。我們更像是一個全方位的貸款人。正如我們在一年多前進行的良好溝通一樣，我們預計我們的投資組合會更快地實現正常化，因為消費者會儘早使用他們的刺激措施，然後就會開始——他們會更快地正常化。這已經發生了。然後正如你提到的那樣，由於 BJ 的離開以及我們所做的客戶住宿損失時間的一些尾隨影響，我們的數字確實有一些噪音。

But the -- when we talk about the confidence to get at or below, I think I heard you say at or below 6%. I think the -- the thing is to have a 6% handle back on the back half of the year, it's because we do have front end of the year noise that with the economic assumptions, I think -- again, there's a range of outcomes for the second half of the year, depending, I mean, if it's a mild year, if inflation starts to abate and then you have a slow increase in unemployment, I think that could be where things fall, the 6% average that we talk about is through the cycle. So you're going to have periods where you're below 6%, years where you're below 6%, then you're going to have years when you're above 6%. And when you're in a recession environment, you've got to be above 6% if you're going to have a through-the-cycle average of 6%. And that's where we are.

但是——當我們談論達到或低於 6% 的信心時，我想我聽到你說達到或低於 6%。我認為 - 事情是在今年下半年有 6% 的處理，這是因為我們確實有年初的噪音，我認為根據經濟假設 - 再一次，有一系列今年下半年的結果，取決於，我的意思是，如果今年是溫和的一年，如果通貨膨脹開始減弱，然後失業率緩慢上升，我認為這可能是事情下降的地方，我們的平均 6%講的就是經歷循環。所以你會有低於 6% 的時期，低於 6% 的年份，然後會有高於 6% 的年份。當你處於衰退環境中時，如果你要獲得 6% 的整個週期平均值，你必須高於 6%。這就是我們所在的位置。

And I think the question that is for all of us is, okay, how long is this recession environment where it gets officially labeled with that [hard word] or not, how deep does it go and how long does it stay right? Is it mild and short, then you get back towards that -- the reversion to the mean faster.

而且我認為對我們所有人來說的問題是，好吧，這種衰退環境會持續多久，正式貼上那個[硬詞]標籤或沒有，它會走多遠，它會保持多長時間？它是溫和而短暫的，然後你會回到那個——更快地回歸到均值。

Yes. I would say the thing to remember is we have improved our portfolio over the last 3 years. But our portfolio is still a bit riskier than our competitors because we underwrite deeper. That said, we get paid for that risk and managing our risk as we move forward. So although we've improved our portfolio, we are still casting a wider net than others, and we get paid for the (inaudible).

是的。我想說的是要記住的是，我們在過去 3 年中改進了我們的產品組合。但我們的投資組合仍然比我們的競爭對手更具風險，因為我們承保得更深。也就是說，我們會為這種風險獲得報酬，並在我們前進的過程中管理我們的風險。因此，儘管我們已經改進了我們的產品組合，但我們仍然比其他人撒下了更廣泛的網絡，並且我們得到了報酬（聽不清）。

Got it. And then just in terms of the credit sales this quarter, just wondering how much of the boost that you saw at the credit sales was driven by AAA?

知道了。然後就本季度的信貸銷售而言，只是想知道您在信貸銷售中看到的增長有多少是由 AAA 驅動的？

Yes. That was a significant amount of the increase. I mean there was a slight increase in credit sales if you were to exclude AAA.

是的。這是一個很大的增長量。我的意思是，如果您排除 AAA，信貸銷售會略有增加。

Our next question comes from Bill Carcache of Wolfe Research.

我們的下一個問題來自 Wolfe Research 的 Bill Carcache。

Ralph and Perry. Perry, I wanted to follow up on your comments around legacy credit models having been built around the concept of rising unemployment and not necessarily some of the inflationary pressures that consumers are facing. There's a view that delinquencies are going to continue to rise, but because labor markets remain exceptionally strong, we'll see them flatten out once we get to sort of the "normalized pre-pandemic levels". Are you expecting given that point that you made that delinquencies could continue to trend higher, sort of above normalized levels because of these inflationary dynamics even though labor market conditions could still remain pretty strong. Just want to make sure I understood what you were -- the point you were making correctly?

拉爾夫和佩里。佩里，我想跟進你對圍繞失業率上升概念建立的遺留信貸模型的評論，而不一定是消費者面臨的一些通脹壓力。有一種觀點認為，拖欠率將繼續上升，但由於勞動力市場仍然異常強勁，一旦我們達到某種“正常化的大流行前水平”，我們就會看到拖欠率趨於平緩。考慮到您提出的觀點，您認為由於這些通脹動態，拖欠率可能會繼續走高，有點高於正常水平，儘管勞動力市場狀況可能仍然相當強勁。只是想確保我理解你的意思——你的觀點是正確的嗎？

Yes. The point I was making on the models was more on loss forecasting models, not credit underwriting models. Credit underwriting models take into account things at the consumer level and taking a whole host of attributes of the consumer that do care for things like you've mentioned income, gainful employment, their debt they have on other issuers. So that all goes in on that. But yes, I mean, you raise exactly one of the key points and why inflation is that the thing the Fed is trying to tackle it is a regression type tax, right?

是的。我在模型上提出的觀點更多是關於損失預測模型，而不是信用承保模型。信用承銷模型考慮了消費者層面的事情，並考慮了消費者的一系列屬性，這些屬性確實關心你提到的收入、有酬工作、他們對其他發行人的債務。所以一切都在這上面。但是，是的，我的意思是，你提出了一個關鍵點，為什麼通貨膨脹是美聯儲試圖解決的問題是回歸型稅收，對吧？

And so moderate income to middle income families are feeling the pressure of that. So yes, while they're gainfully employed and yes, while there is wage growth that wage growth is not keeping up with things that are putting pressure on their families. And you see that with some increasing leverage and all of this impacts eventually ability to pay, and that's where customers can fall behind.

因此，中等收入到中等收入家庭正感受到這種壓力。所以是的，雖然他們有高薪工作，是的，雖然工資增長了，但工資增長跟不上給他們的家庭帶來壓力的事情。你會看到，隨著槓桿率的增加，所有這些最終都會影響支付能力，而這正是客戶可能落後的地方。

And if you even think about inflation as what we're seeing today, while it's moderating a little bit, it's -- some of it is -- there's good news in there, but it's really driven because there's lower fuel prices and lower used in new car prices, which certainly helps people own cars, but not everybody does. But on the flip side, shelter cost, food prices and utility costs are up significantly month-over-month and year-over-year. So while inflation (inaudible), this is still concerning for most American even while they're -- like I said, it's a job full environment and they're doing their best, but they're making choices on spend, which is why I think you're starting to start to see some deceleration in overall spend, and we see some shift from discretionary to nondiscretionary, but all these things put pressure for folks.

如果你甚至認為通貨膨脹就像我們今天看到的那樣，雖然它正在緩和一點，但它 - 其中一些是 - 那裡有好消息，但它確實受到推動，因為燃料價格較低且使用較少新車價格，這當然有助於人們擁有汽車，但並不是每個人都這樣做。但另一方面，住房成本、食品價格和公用事業成本逐月和同比大幅上漲。因此，儘管通貨膨脹（聽不清），這對大多數美國人來說仍然是令人擔憂的，即使他們 - 就像我說的那樣，這是一個充滿工作的環境並且他們正在盡力而為，但他們正在做出支出選擇，這就是為什麼我認為你開始看到整體支出有所放緩，我們看到一些從自由支配到非自由支配的轉變，但所有這些都給人們帶來了壓力。

Understood. That's super helpful, Perry. And separately, Ralph, I wanted to follow up on your late fee commentary. I appreciate all the color. But I wanted to ask, if I could follow up on the comment you made last quarter that the safe harbor you thought surrounding late fees was more likely to be reduced rather than eliminated. Is there any way you could give us an update there and maybe frame the potential magnitude of any reduction or impact that you think we could see?

明白了。佩里，這非常有幫助。另外，拉爾夫，我想跟進你對滯納金的評論。我欣賞所有的顏色。但我想問一下，我是否可以跟進你上個季度發表的評論，即你認為圍繞滯納金的安全港更有可能減少而不是消除。您是否可以通過任何方式向我們提供最新情況，並可能構建您認為我們可以看到的任何減少或影響的潛在幅度？

I know what you know from the CFPB, that was just what I would suspect that happen in the third quarter. I don't want to guess on what will happen. Whatever will happen, we're ready for it. We will lean into it, and we will manage accordingly.

我知道你從 CFPB 那裡了解到的情況，這正是我懷疑第三季度會發生的情況。我不想猜測會發生什麼。無論發生什麼，我們都做好了準備。我們將融入其中，並據此進行管理。

Our next question comes from Mihir Bhatia of Bank of America (inaudible).

我們的下一個問題來自美國銀行的 Mihir Bhatia（聽不清）。

I wanted to go back on to the credit guidance. And following up a little bit on Jeff's question, earlier. I just wanted to better understand the reason you have a high degree of confidence that the back half of '23 would be below 7% at least. Right, just given your implied guide of [1H] about the 7%. So like given the high unemployment, you have BJs coming out. I understand you have some noise in the first half, but if I recall, that's about a 30%, 35% [bps] impact there. Why would the back half come in below the first half, just given the macroeconomic pressures you are pointing to, right, with unemployment increasing throughout the year?

我想回到信貸指導。並稍微跟進了 Jeff 之前的問題。我只是想更好地理解您高度相信 23 年後半年至少會低於 7% 的原因。是的，只是給出了關於 7% 的 [1H] 的隱含指南。所以就像高失業率一樣，你有 BJs 出來。我知道你在上半年有一些噪音，但如果我記得的話，那大約有 30%、35% [bps] 的影響。為什麼後半部分會低於上半年，只是考慮到你所指出的宏觀經濟壓力，對，全年失業率都在增加？

And then relatedly, just in terms of your delinquencies and losses, like when do you expect delinquencies to peak and in terms of losses, given you've normalized faster than peers, do your losses peak before your peers who've all talked about that happening maybe in 2024. Any additional color you can help us with some of that.

然後相關地，就你的拖欠和損失而言，比如你預計拖欠什麼時候會達到頂峰，就損失而言，鑑於你比同行更快地正常化，你的損失會在你的同行之前達到峰值嗎？可能會在 2024 年發生。任何其他顏色都可以幫助我們解決一些問題。

Yes. So I want to be more clear, right? When we say the losses could be approximately or around 7%, that does not necessarily imply that the back half of the year will be significantly below the first half of the year. So it could still have a 7 handle on it. It could be slightly below, it could be still slightly above or it could be flat. So I want to moderate the expectation that the second half will be materially lower. And I think you said it, there's a lot of economic uncertainty in the back half of the year and what continues to happen with inflation and unemployment. So I think there's a lot of speculation and we'll continue to update those expectations as we march forward.

是的。所以我想說得更清楚，對吧？當我們說損失可能約為或約為 7% 時，這並不一定意味著今年下半年將大大低於上半年。所以它仍然可以有一個 7 句柄。它可能略低於，也可能仍然略高於，也可能是平坦的。所以我想緩和下半年會大幅下降的預期。我想你說過，今年下半年存在很多經濟不確定性，通貨膨脹和失業率繼續發生。所以我認為有很多猜測，我們將在前進的過程中繼續更新這些期望。

In terms of normalization, will we peak sooner I hope so. I think that -- so normalization of the higher end consumer is lagging. And when you think about the way when you underwrite with where we do the full spectrum, we manage losses very carefully and at a -- in line carefully where they -- you manage a low line with a lot less open to buy compared to if we were in that super prime space, we have large lines, lots of open to buy. So when unemployment hits you're taking for a large line for us, you don't have as much open to buy. So as unemployment comes through, we have less severity risk is the way to think about that. So we may be less volatile.

在正常化方面，我希望我們能早點達到頂峰。我認為 - 所以高端消費者的正常化是滯後的。當您考慮在我們進行全範圍承銷時的方式時，我們會非常小心地管理損失，並且在 - 小心地排隊 - 與如果相比，您可以管理低線，購買機會少得多我們在那個超級黃金地段，我們排著長隊，有很多可以購買的地方。因此，當失業率來襲時，您為我們準備了一大筆錢，您就沒有那麼多可以購買的商品了。因此，隨著失業的到來，我們的嚴重性風險會降低，這是思考這個問題的方式。所以我們可能不那麼不穩定。

Our next question comes from David Scharf of JMP.

我們的下一個問題來自 JMP 的 David Scharf。

Most have been answered. Perry, I guess I just wanted to follow up a little on the NIM outlook, which is effectively flattish from fourth quarter throughout the year. I mean, I believe, historically, the company has always had sort of a net asset-sensitive model. And notwithstanding the reprising rates, I'm wondering, given the fact that deposit funding has continued to increase as a part of the mix, and we've successfully had a number of months past now where we can flatten out that the impact of the abrupt changes, the abrupt Fed rate rises and passing it along to consumers. Why wouldn't throughout this year, especially if we're not looking at any surprise increases from the Fed beyond the current outlook, why wouldn't there be a net positive impact in NIM? Is it primarily related to expectations at late fees first get reversed out with higher losses and maybe tempering kind of the late fee modeling as well based on what the CFPB might propose?

大部分都已經回答了。佩里，我想我只是想跟進一下 NIM 前景，從全年第四季度開始，它實際上是持平的。我的意思是，我相信，從歷史上看，該公司一直有一種對淨資產敏感的模型。儘管利率有所上升，但我想知道，鑑於存款資金作為組合的一部分繼續增加這一事實，而且過去幾個月我們已經成功地消除了影響突然的變化，美聯儲突然加息並將其傳遞給消費者。為什麼今年不會，特別是如果我們沒有看到美聯儲超出當前前景的任何意外加息，為什麼 NIM 不會產生淨積極影響？它主要與滯納金的預期有關，首先會因更高的損失而被逆轉，並且可能會根據 CFPB 可能提出的建議緩和滯納金模型嗎？

What I would say is that the -- our outlook doesn't contemplate anything with the CFPB changes because, as Ralph said, we can't speculate from what that means. But as it relates to net interest margin, you kind of touched on it, is we have been slightly asset sensitive. Our objective is to be close to neutral. And then as you think about NIM, there's many components from the asset mix, meaning the product mix, risk mix that goes in there and then when you enter a period of rising loss as you kind of said it is that the increase in late fees that you get or rollover is partially dampened when the losses come through because of the reversal of billed interest and fees.

我要說的是——我們的前景沒有考慮 CFPB 的任何變化，因為正如拉爾夫所說，我們無法推測這意味著什麼。但由於它涉及淨息差，你有點觸及它，我們對資產略微敏感。我們的目標是接近中立。然後，當你想到 NIM 時，資產組合中有很多組成部分，這意味著產品組合、風險組合，然後當你進入虧損上升時期時，就像你說的那樣，滯納金增加當由於記帳利息和費用的逆轉而導致損失時，您獲得的收益或展期將部分減少。

So it's all those things together. And then on top of that, we will have a changing funding mix throughout the year as we work through our debt stack and then you continue to shift to more deposits and things. So we're just giving guidance for what we think is a good way to model a base case forward.

所以這就是所有這些東西。然後最重要的是，在我們處理債務堆棧的過程中，我們全年的資金組合都會發生變化，然後你會繼續轉向更多的存款和其他東西。因此，我們只是為我們認為對基本案例進行建模的好方法提供指導。

Understood. Appreciate the detail. And then just a quick follow-up. I know and I'm sure on the upcoming investor event, what will get updated background on kind of the vertical mix and other ways to sort of slice and dice the portfolio profile. But I noticed in the slides on new signings, there was another jewelry vertical retailer involved. Can you update us on kind of what percentage of balances are associated with that vertical, which has always been so prominent for you?

明白了。欣賞細節。然後只是快速跟進。我知道並且我確信在即將舉行的投資者活動中，將獲得關於垂直組合類型的更新背景以及其他對投資組合概況進行切片和切塊的方法。但我注意到在新簽約的幻燈片中，還有另一家珠寶垂直零售商參與其中。您能否向我們介紹與該垂直相關的餘額百分比，這對您來說一直如此突出？

Jewelry, specific?

珠寶，具體？

Yes.

是的。

Probably for us, the low double digit in terms of receivables.

可能對我們來說，應收賬款方面的低兩位數。

Our next question comes from Dominick Gabriele of Oppenheimer.

我們的下一個問題來自 Oppenheimer 的 Dominick Gabriele。

Great. I want to talk about the spending trajectory throughout 2023. And do you think it would make sense that the consumer would continue to slow their spending, given what we're seeing in inflation coming down because that's going to hurt nominal dollars, right, the grow-over effect of nominal dollars being dampened and really, the fact that would you expect spending to slow down through the period before up until we hit peak unemployment? And then I just have a follow-up.

偉大的。我想談談整個 2023 年的支出軌跡。你認為消費者繼續放慢支出是否合理，因為我們看到通脹正在下降，因為這會損害名義美元，對吧，名義美元的增長效應受到抑制，實際上，在我們達到失業率高峰之前，您是否預計支出會在這段時間內放緩？然後我有一個後續行動。

Yes. I think that's -- that is our speculation a little bit as we're starting to see some decelerating spend. So I think when you think about that, that's impacting the individual consumers, as we talked about earlier, if you think that their utilities costs and food costs have gone up $100 in a month, where they've got to slow down spend elsewhere. So I do think that's a factor. For us as a company, we've continued to add new partners in 2022 and increase our marketing. So for us, we continue to see some overall spend growth -- originations growth even with the departure of BJs. But that -- and that is a -- it was a high transactor portfolio. So for us, that will slow our growth a little bit more than what it might have otherwise.

是的。我認為那是 - 這是我們的猜測，因為我們開始看到一些減速支出。所以我認為，當你考慮到這一點時，這會影響個人消費者，正如我們之前談到的那樣，如果你認為他們的公用事業成本和食品成本在一個月內上漲了 100 美元，他們必須在其他地方放慢支出。所以我認為這是一個因素。作為一家公司，我們在 2022 年繼續增加新的合作夥伴並增加我們的營銷。因此，對我們來說，我們繼續看到一些整體支出增長——即使 BJs 離開，起源也在增長。但那 - 那是 - 這是一個高交易量的投資組合。所以對我們來說，這將比其他情況下更能減緩我們的增長。

But overall, the consumer, again, is still -- I think we said earlier, so gainfully employed, jobs to be had, small businesses are hiring even though you're reading about layoffs of big companies, there's lots of jobs out there. So that's what gives me encouragement that we're going to move through what would be more of a mild economic scenario.

但總的來說，消費者仍然 - 我想我們之前說過，所以有酬就業，有工作，小企業正在招聘，即使你正在閱讀有關大公司裁員的信息，那裡有很多工作。因此，這讓我感到鼓舞，我們將經歷更溫和的經濟情景。

Yes. And I kind of mentioned it before, the shifts in our portfolio help us maintain spend, right? So if they move from discretionary to nondiscretionary, we have products and services that the spend will be sticky to us.

是的。我之前提到過，我們投資組合的轉變有助於我們維持支出，對吧？因此，如果他們從自由支配轉變為非自由支配，我們的產品和服務的支出將對我們產生粘性。

Great. Great. I really appreciate that. And if we -- I just want to walk through this formula with you guys. If you think about growth math and the fact that a lot of -- you and your peers have seen some really significant growth over the last few years, that puts that kind of growth math seasoning peak through the python dynamic, right? On the front book, but if we have unemployment rising, that would affect the front and back book. And so I feel like that would have almost like a doubling of -- not a pure double, but an increased additive effect on the net charge-off rate, if you have the peak-through-the-python and the back book is getting worse because of unemployment. Does that make sense to you or am I getting something wrong?

偉大的。偉大的。我真的很感激。如果我們——我只想和你們一起了解這個公式。如果您考慮增長數學，以及您和您的同行在過去幾年中看到了一些非常顯著的增長這一事實，那麼這種增長數學調味料通過 python 動態達到頂峰，對吧？在正面賬簿上，但如果我們的失業率上升，那將影響正面和背面賬簿。因此，我覺得這幾乎就像翻了一番——不是純粹的翻倍，而是對淨沖銷率的增加效應，如果你有 peak-through-the-python 和 back book 越來越更糟的是因為失業。這對你有意義還是我弄錯了什麼？

No. I think in general terms, sure. But I'll speak specific to us. When you think about the growth that we've taken on over the past year, a good chunk of that was due to 2 portfolio acquisitions of the NFL and AAA in 2022. Those are already seasoned portfolio. So when you hear others talk about all this growth and they've got vintages, they're going to get peak losses in the next 24 months. That's not the case for us because there came in season, we were taking losses in the first month, they were on the book. So start with that for us.

不，我認為一般來說，當然。但我會具體講給我們聽。當您考慮我們過去一年的增長時，其中很大一部分是由於 2022 年對 NFL 和 AAA 的 2 項投資組合收購。這些已經是成熟的投資組合。因此，當你聽到其他人談論所有這些增長並且他們有年份時，他們將在接下來的 24 個月內達到峰值損失。對我們來說情況並非如此，因為季節來了，我們在第一個月就虧損了，他們在賬簿上。所以從我們開始。

And then if you think about the product mix, that also influences that growth map seasoning concept because of the degree that we have private label cards, they start to season and peak in the, say, month 12 to 18 months, whereas many of those co-brands and other things peak 24 to 36 months. So ours within the first 12 to 18 months, we peaked in season. So we season a lot faster.

然後，如果你考慮產品組合，這也會影響增長圖調味概念，因為我們擁有自有品牌卡的程度，它們開始調味並在 12 到 18 個月達到頂峰，而其中許多聯合品牌和其他東西在 24 到 36 個月達到頂峰。因此，我們在前 12 到 18 個月內達到了旺季。所以我們的季節要快得多。

Yes. I think the other thing I would say, too, is we haven't been sitting still. We've been proactively managing the back book and the front book with the right line assignments, right treatment for card member, underwriting for the right Vantage score. So we've been managing our recession handbook for the last 2.5 years. And so as I think about it, it puts us in good shift to know what's in the book and know where to focus.

是的。我想我還要說的另一件事是，我們沒有坐以待斃。我們一直在通過正確的線路分配、對持卡人的正確待遇、為正確的 Vantage 分數承銷來主動管理後書和前書。因此，在過去 2.5 年裡，我們一直在管理我們的經濟衰退手冊。因此，正如我所想的那樣，它使我們能夠很好地了解書中的內容並知道應該關注的地方。

Great. No, that's really, really helpful. Ralph, maybe just really quickly one more for you. Just you have really great co-brand and private label portfolios. How do you see the dynamics playing out between the 2? And as far as net charge-off rates and where you may decide to pull back in your underwriting one versus the other in the downturn?

偉大的。不，那真的非常有用。拉爾夫，也許真的很快再給你一個。只是您擁有真正出色的聯合品牌和自有品牌組合。您如何看待兩者之間的動態變化？至於淨註銷率，以及在經濟低迷時期你可能決定在哪個方面撤回你的承保？

Yes. So it's the private label portfolios have terrific margins, but they also have a little bit more risk in them. While the co-brand portfolios have good margins, but the risk is less. So if you think as you go into the economy, we certainly want to be fair with all our partners. It's important that we work through and make sure that we are doing the right thing by all our partners. But to me, it's really a balanced approach and making sure that we're taking the right risk for the right reward.

是的。因此，自有品牌組合的利潤率很高，但它們也有更多的風險。雖然聯名品牌組合有不錯的利潤率，但風險較小。因此，如果您在進入經濟領域時考慮，我們當然希望對所有合作夥伴公平。重要的是我們要努力完成並確保我們所有的合作夥伴都在做正確的事情。但對我來說，這確實是一種平衡的方法，可以確保我們為獲得正確的回報而承擔正確的風險。

Our next question comes from John Hecht of Jefferies.

我們的下一個問題來自 Jefferies 的 John Hecht。

Just your newer partners, the NFL, the Yankees, the AAA. It's a different, I guess, characteristic relative to some of your older traditional retail counterparts. So I'm wondering, given that they represent slightly different kind of associations -- is there different some characteristics with the usage of the credit cards or the credit relationship with the customers from those different channels?

只是您的新夥伴，NFL、洋基隊和 AAA。我想，相對於一些較早的傳統零售同行，這是一個不同的特徵。所以我想知道，鑑於它們代表的關聯類型略有不同——信用卡的使用或與來自這些不同渠道的客戶的信用關係是否存在某些不同的特徵？

Yes. So there -- some of those cards are top of wallet cards. And so if you think about it, right? So I think about AAA, it's a top all of cards. So you kind of make sure you have the right line for the right people. It's higher use. It's a discretionary spend, it's nondiscretionary spend. That's their product. So make sure that we have the right treatments for those co-brand cards, which may differ a little bit from the treatments you have for the private label card. But diversification for us is key, and we don't treat every card equally. We treat it based on the habits of those people and those products.

是的。所以那裡 - 其中一些卡是錢包卡的頂部。因此，如果您考慮一下，對嗎？所以我想到了 AAA，它是所有卡片中的佼佼者。因此，您要確保為合適的人提供合適的線路。用處更高。這是可自由支配的支出，這是非自由支配的支出。那是他們的產品。因此，請確保我們對這些聯名卡採取正確的處理方式，這可能與您對自有品牌卡的處理方式略有不同。但多元化對我們來說是關鍵，我們不會平等對待每張牌。我們根據那些人和那些產品的習慣來對待它。

Is the general line extension and utilization rate consistent with some of the other platforms or is there anything to point out there?

總的線路延伸和利用率是否與其他一些平台一致，或者有什麼要指出的嗎？

It depends on the credit worthiness of the individual, right? So that's how we look at it. We don't look at it on a portfolio basis. We look at it within the portfolio and the performance of the individual and their credit worthiness.

這取決於個人的信譽，對吧？這就是我們的看法。我們不以投資組合為基礎來看待它。我們在投資組合以及個人的表現和他們的信用價值中查看它。

Okay. That's helpful. And then a follow-up. We've heard from some of the other card issuers that maybe there's a decline and the pressures -- ongoing pressures on deposit prices. Are you guys seeing that? Or is there any commentary just over the past few weeks and what you're seeing in the deposit market?

好的。這很有幫助。然後是跟進。我們從其他一些發卡機構那裡聽說，可能存在下降和壓力——存款價格持續面臨壓力。你們看到了嗎？或者過去幾周有什麼評論以及您在存款市場上看到的情況嗎？

Yes. So for us, deposits remains -- a direct consumer deposit remains a key funding component. The pressures are out there in terms of pricing, yes, it's competitive. And we've been helping to lead the way on that competition because for us, it's a great source of funds. We are variable priced and we have terrific loan yields that can absorb the increases in prime. And as prime goes up, if we want to pass that through our deposit pricing, we get it on topside revenue. So we're good.

是的。所以對我們來說，存款仍然存在——直接的消費者存款仍然是一個關鍵的資金組成部分。在定價方面存在壓力，是的，它具有競爭力。我們一直在幫助引領這場競爭，因為對我們來說，這是一個很好的資金來源。我們的價格是可變的，我們的貸款收益率非常好，可以吸收優質貸款的增加。隨著 prime 的上漲，如果我們想通過我們的存款定價來傳遞它，我們就會得到它的最高收入。所以我們很好。

Yes. It's a real opportunity for growth for us. We have lower overhead and really helps our funding capabilities.

是的。這對我們來說是一個真正的增長機會。我們的管理費用較低，確實有助於我們的融資能力。

I guess the question is as we go into this year, is it similar competition to the last few months or given that the new rate outlook might be changing, are you seeing mitigated -- not mitigated competition, but maybe less aggressive pressure on incremental rates.

我想問題是，隨著我們進入今年，它的競爭是否與過去幾個月類似，或者考慮到新的利率前景可能會發生變化，你是否看到緩解 - 不是緩解競爭，但可能對增量利率的壓力較小.

It's the same.

一樣的。

Our final question of the day comes from Reggie Smith of JPMorgan Chase.

我們今天的最後一個問題來自摩根大通的雷吉史密斯。

A little bit, I guess, on a different subject. A lot of focus has been on credit quality. I was curious -- I was hoping you guys could probably answer this. What proportion of your business today and whether that's spend or revenues, would you say is related to Bread? And that could be the buy now, pay later, it could be the [MX] card. Let me actually expand beyond this. And not just Bread, but anything like modern, so a digital-first card, what I'm trying to get at or understand is it feels like there's probably a story within the story that may be getting missed. And so I was curious if you could share how large that business is and maybe how fast it's growing? Because I would imagine that over time, that, that's going to be a bigger piece and an interesting piece of the story.

一點點，我想，在一個不同的主題上。很多注意力都集中在信貸質量上。我很好奇——我希望你們能回答這個問題。你今天的業務有多大比例，無論是支出還是收入，你會說與麵包有關嗎？那可能是現在購買，以後付款，它可能是 [MX] 卡。讓我實際擴展到此之外。不僅是麵包，還有任何類似現代的東西，所以一張數字優先的卡片，我想要了解或理解的是，感覺故事中可能有一個故事可能被遺漏了。所以我很好奇您是否可以分享該業務的規模以及增長的速度？因為我想隨著時間的推移，這將是一個更大的部分，也是一個有趣的故事部分。

Well, the cards business, right? Things take time to grow, right? So we've been with both those products a year or last or just about a year. So I could tell you that 40% of our new accounts are digital channels, right? So and I expect that 40% to grow given our new capabilities, given the capability we're going to put in place. So we expect those digital channels to grow. And we do expect direct-to-consumer to grow. I think that American Express product, 2% cashback is a really good quality product out there. The virtual card was just introduced that will have some traction in 2023, 2024. So while it's not the biggest part of our portfolio today, it is a growing part of our portfolio.

那麼，卡片業務，對嗎？事物的成長需要時間，對吧？所以我們已經使用這兩種產品一年或去年或大約一年。所以我可以告訴你，我們 40% 的新客戶都是數字渠道，對吧？因此，鑑於我們將要具備的能力，我預計 40% 會增長。因此，我們預計這些數字渠道會增長。我們確實希望直接面向消費者的業務能夠增長。我認為 American Express 的產品，2% 的現金返還是一個非常優質的產品。虛擬卡剛剛推出，將在 2023 年、2024 年產生一定的吸引力。因此，雖然它不是我們今天投資組合中最大的部分，但它是我們投資組合中不斷增長的一部分。

Got it. And if I could sneak one more in. Have you guys ever provided, I guess, a longer-term target for efficiency ratio. I know you talked about margin expansion. That's been a theme every year, you kind of mentioned that. But is there a long-term target that you're driving towards?

知道了。如果我能再偷偷進來一個。你們有沒有提供過，我猜，效率比的長期目標。我知道你談到了利潤率擴張。這是每年的主題，你有點提到過。但是您是否有一個長期目標？

We talk about in terms of positive operating leverage for now. As we think about the future potentially. But right now, we talk about positive operating leverage, which also helps our efficiency ratio. We have some internal targets, but primarily, we're looking making sure that our expenses outpaced -- our revenue outpaces our expense growth.

我們現在談論的是積極的經營槓桿。當我們潛在地思考未來時。但現在，我們談論積極的經營槓桿，這也有助於我們的效率比。我們有一些內部目標，但主要是，我們希望確保我們的支出超過 - 我們的收入超過我們的支出增長。

Understood.

明白了。

Thank you all. I know we ran a bit over, but I think it's time well spent with you. I really appreciate the interest in Bread Financial. I look forward to talking to you all soon. Everybody, have a good day.

謝謝你們。我知道我們有點過頭了，但我認為與你共度時光。我非常感謝大家對 Bread Financial 的興趣。我期待著很快與大家交談。大家，祝你有個美好的一天。

Ladies and gentlemen, that concludes today's call. You may now disconnect your lines.

女士們，先生們，今天的電話會議到此結束。您現在可以斷開線路。