發現金融 (DFS) 2023 Q1 法說會逐字稿

Good morning. My name is Chelsea, and I will be your conference operator today. At this time, I would like to welcome everyone to the First Quarter 2023 Discover Financial Services Earnings Conference Call.

早上好。我叫切爾西，今天我將擔任你們的會議運營商。此時，我想歡迎大家參加 2023 年第一季度發現金融服務收益電話會議。

(Operator Instructions)

（操作員說明）

Thank you. I will now turn the call over to Mr. Eric Wasserstrom, Head of Investor Relations. Sir, please go ahead.

謝謝。我現在將把電話轉給投資者關係主管 Eric Wasserstrom 先生。先生，請繼續。

Thank you, Chelsea, and good morning, everyone. Welcome to this morning's call. I'll begin on Slide 2 of our earnings presentation, which you can find in the financial section of our Investor Relations website, investorrelations.discover.com.

謝謝你，切爾西，大家早上好。歡迎來到今天上午的電話會議。我將從我們收益演示的幻燈片 2 開始，您可以在我們的投資者關係網站 investorrelations.discover.com 的財務部分找到它。

Our discussion today contains certain forward-looking statements that are subject to risks and uncertainties that may cause actual results to differ materially. Please refer to our notices regarding forward-looking statements that appear in our first quarter earnings press release and presentation.

我們今天的討論包含某些前瞻性陳述，這些陳述受風險和不確定因素的影響，可能導致實際結果出現重大差異。請參閱我們關於出現在我們第一季度收益新聞稿和演示文稿中的前瞻性陳述的通知。

Our call today will include remarks from our CEO, Roger Hochschild; and John Greene, our Chief Financial Officer. After we conclude our formal comments, there will be time for a question-and-answer session.

我們今天的電話會議將包括我們的首席執行官 Roger Hochschild 的講話；和我們的首席財務官 John Greene。在我們結束正式評論後，將有時間進行問答環節。

(Operator Instructions)

（操作員說明）

Now it's my pleasure to turn the call over to Roger.

現在我很高興將電話轉給羅傑。

Thanks, Eric, and thanks to our listeners for joining today's call. I'll begin by commenting on some of the recent events in the banking industry, review our highlights for the quarter, and then John will take you through the details of our first quarter results and our updated perspectives on 2023.

謝謝埃里克，也感謝我們的聽眾加入今天的電話會議。我將首先評論銀行業最近發生的一些事件，回顧我們本季度的亮點，然後 John 將向您詳細介紹我們第一季度的業績以及我們對 2023 年的最新展望。

This past quarter include the failure of 2 large banks, an event that catalyzed more widespread stress in some segments of the banking system and raised questions about the funding models and embedded portfolio losses of multiple banks. In contrast, our strong results underscore how our model with its diversified funding, trusted brand, focus on prime consumer lending and conservative risk management positions us to succeed through a range of operating conditions.

上個季度包括兩家大型銀行倒閉，這一事件在銀行系統的某些部分引發了更廣泛的壓力，並引發了對多家銀行的融資模式和嵌入式投資組合損失的質疑。相比之下，我們強勁的業績突顯了我們的模式如何以其多元化的資金、值得信賴的品牌、專注於優質消費貸款和保守的風險管理使我們能夠在一系列運營條件下取得成功。

I want to call out a few results in particular that highlight our performance in this challenging environment. We reported first quarter net income of $1 billion or $3.58 per share. We had an all-time record quarter in terms of consumer deposit inflows and leveraging our award-winning digital experience and our leading customer service, and we're improving key elements of our guidance.

我想特別指出一些突出我們在這個充滿挑戰的環境中的表現的結果。我們報告第一季度淨收入為 10 億美元或每股 3.58 美元。我們在消費者存款流入和利用我們屢獲殊榮的數字體驗和領先的客戶服務方面創下了歷史新高，並且我們正在改進我們指導的關鍵要素。

As we look to the remainder of 2023, we may adjust our outlook as conditions evolve. We believe there is the potential for more stringent regulation. We believe we're well positioned for more rigorous regulatory capital and liquidity requirements given our strong internal standards, and we also continue to focus on enhancing our compliance management systems.

展望 2023 年剩餘時間，我們可能會隨著情況的發展調整我們的展望。我們認為有可能實施更嚴格的監管。我們相信，鑑於我們強大的內部標準，我們完全有能力滿足更嚴格的監管資本和流動性要求，並且我們還將繼續專注於加強我們的合規管理系統。

This past quarter also included an important milestone with respect to our investment in human capital. We're honored to have been recognized as one of Fortune's 100 Best Companies to work for in 2023. This is the first time we've earned this distinction. It builds upon recognition we received last year, ranking us among the best workplaces for parents and Fortune's best workplaces for women.

上個季度還包括我們在人力資本投資方面的一個重要里程碑。我們很榮幸被《財富》雜誌評為 2023 年最適合工作的 100 家公司之一。這是我們第一次獲得這一殊榮。它建立在我們去年獲得認可的基礎上，將我們列為最適合父母的工作場所和《財富》雜誌最適合女性的工作場所。

In conclusion, we believe our earnings power, balance sheet strength, investments in people and advancements and capabilities support our strategy of becoming the leading consumer digital bank. I'll now turn the call over to John to review our results in more detail.

總之，我們相信我們的盈利能力、資產負債表實力、對人員的投資以及進步和能力支持我們成為領先的消費者數字銀行的戰略。我現在將電話轉給約翰，以更詳細地審查我們的結果。

Thank you, Roger, and good morning, everyone. I'll start with our financial summary results on Slide 4. Our performance this quarter was characterized by strong revenue growth, continued credit normalization, a slight change to our outlook on the macroeconomic environment, resulting in a reserve increase and a year-over-year increase in expenses.

謝謝羅傑，大家早上好。我將從幻燈片 4 上的財務摘要結果開始。我們本季度的表現特點是收入增長強勁、信貸持續正常化、我們對宏觀經濟環境的展望略有變化，導致準備金增加和同比增長年支出增加。

Let's review the details starting on Slide 5. Net interest income was up $653 million year-over-year or 26%. Our net interest margin continued to expand, benefiting from higher prime rates, partially offset by higher funding costs and increased promotional balances. NIM ended the quarter at 11.34%, up 49 basis points from the prior year and 7 basis points sequentially.

讓我們從幻燈片 5 開始查看詳細信息。淨利息收入同比增長 6.53 億美元或 26%。我們的淨息差繼續擴大，受益於較高的最優惠利率，部分被較高的融資成本和增加的促銷餘額所抵消。 NIM 本季度末收於 11.34%，較上年同期上漲 49 個基點，環比上漲 7 個基點。

Receivable growth was driven by card, which increased 22% year-over-year, reflecting stable sales growth, modest new account growth and payment rate moderation. Sales increased 9% in the period slightly higher than the 8% growth we experienced in the prior quarter and down from the 16% growth we experienced in 2022.

應收賬款增長是由信用卡推動的，同比增長 22%，反映了穩定的銷售增長、適度的新賬戶增長和支付率的放緩。在此期間，銷售額增長了 9%，略高於上一季度 8% 的增幅，低於 2022 年 16% 的增幅。

Sales growth so far in April is a modest 2.5% but this is coming off a very high comp of 22% in April of last year. New card account growth decelerated, reflecting the tightening of underwriting standards over the past several months but grew by 3% from the prior year.

到目前為止，4 月份的銷售增長率僅為 2.5%，但與去年 4 月份 22% 的非常高的增長率相比有所下降。新卡賬戶增長放緩，反映了過去幾個月承保標準的收緊，但比去年增長了 3%。

The impact of slowing sales growth on receivable expansion was offset by decreases in payment rates. The card payment rate decreased 80 basis points in the quarter and is currently slightly over 200 basis points above the pre-pandemic level.

銷售增長放緩對應收賬款擴張的影響被支付率下降所抵消。本季度信用卡支付率下降了 80 個基點，目前比大流行前水平略高 200 個基點。

Turning to our non-card products. Personal loans were up 21%, driven by higher originations over the past year and lower payment rates. We continue to experience strong consumer demand while staying disciplined in our underwriting of this product.

轉向我們的非卡片產品。個人貸款增長了 21%，這是由於過去一年的貸款發放量增加和還款率下降。我們繼續感受到強勁的消費者需求，同時在我們對該產品的承保方面保持紀律。

Organic student loan receivables grew by 3%, largely driven by a reduction in the payment rate.

有機學生貸款應收賬款增長了 3%，這主要是由於還款率下降所致。

In terms of funding mix, consumer deposit balances were up 17% year-over-year and 7% sequentially. As Roger highlighted, we achieved record quarterly deposit growth. Deposits now make up 66% of our total funding mix with over 90% insured and we continue to target 70% to 80% deposit funding over the medium term.

在資金組合方面，消費者存款餘額同比增長 17%，環比增長 7%。正如羅傑強調的那樣，我們實現了創紀錄的季度存款增長。存款現在占我們總資金組合的 66%，其中超過 90% 是受保的，我們繼續將中期內存款資金的目標定為 70% 至 80%。

Outside of deposits, our funding channels remain open and at attractive costs. As an example, in early April, we issued $1.25 billion of card ABS fixed rate notes. This offering was upsized and our spread was 9 basis points tighter than our November securitization. Additionally, we recently received a ratings upgrade by Moody's for our bank subsidiary and our banking holding company. Moody's cited a number of reasons to support this upgrade, including our prudent underwriting, conservative risk management and resiliency in an economic downturn.

除存款外，我們的融資渠道保持暢通且成本極具吸引力。例如，4 月初，我們發行了 12.5 億美元的卡式 ABS 固定利率票據。這次發行規模擴大，我們的利差比我們 11 月份的證券化要小 9 個基點。此外，我們最近收到了穆迪對我們銀行子公司和銀行控股公司的評級升級。穆迪列舉了一些支持此次升級的理由，包括我們審慎的承銷、保守的風險管理和在經濟低迷時期的彈性。

Looking at other revenue on Slide 6. Noninterest income increased $198 million or 47%. This was partially due to a $162 million loss on our equity investments in the prior year quarter compared to an $18 million loss this quarter. Adjusting for these, our noninterest income was up 9%, primarily driven by the loan fee income and higher net discount and interchange revenue.

查看幻燈片 6 上的其他收入。非利息收入增加了 1.98 億美元或 47%。這部分是由於我們在去年同期的股權投資虧損 1.62 億美元，而本季度虧損 1800 萬美元。對這些進行調整後，我們的非利息收入增長了 9%，這主要是由於貸款費用收入以及更高的淨折扣和交換收入。

Moving to expenses on Slide 7. Total operating expenses were up $253 million or 22% year-over-year and down 7% from the prior quarter. Compensation costs were up primarily due to increased headcount and wage inflation. Marketing expenses increased $49 million or 26% as we continue to prudently invest for growth in our card and consumer banking products.

轉到幻燈片 7 的支出。總運營支出同比增長 2.53 億美元或 22%，比上一季度下降 7%。薪酬成本上升主要是由於員工人數增加和工資上漲。營銷費用增加了 4900 萬美元或 26%，因為我們繼續審慎地投資於我們的卡和消費銀行產品的增長。

Professional fees increased $55 million or 31%, driven by investments in technology and increases and consulting activities that support our consumer compliance initiatives. Even with these increases, our efficiency ratio was 37%, and we generated about 700 basis points of operating leverage in the period.

專業費用增加了 5500 萬美元或 31%，這主要得益於技術投資以及支持我們的消費者合規計劃的諮詢活動的增加。即使有這些增長，我們的效率比率仍為 37%，我們在此期間產生了約 700 個基點的經營槓桿。

Moving to credit performance on Slide 8. Total net charge-offs were 2.72%, 111 basis points higher than the prior year and up 59 basis points from the prior quarter. In the card portfolio, the net charge-off rate of 3.1% was 126 basis points higher than the prior year and 73 basis points higher sequentially. Consistent with our commentary back in January, we expect the seasoning of new account vintages from the past 2 years and normalization of older vintages to a more typical loss rate. These trends remain consistent with our expectations.

轉向幻燈片 8 的信用表現。淨註銷總額為 2.72%，比上年高 111 個基點，比上一季度高 59 個基點。在信用卡組合中，淨沖銷率為 3.1%，比上年高 126 個基點，比上一季度高 73 個基點。與我們在 1 月份發表的評論一致，我們預計過去 2 年的新賬戶年份將有所調整，舊年份的損失率將正常化至更典型的損失率。這些趨勢與我們的預期保持一致。

Turning to the discussion of our allowance on Slide 9. This quarter, we increased our allowance by $385 million, and our reserve rate increased by 25 basis points to 6.8%. This increase in reserve rate was driven by 2 factors. About 10 basis points reflects the runoff of seasonal transactor balances that we typically experienced in the fourth quarter. The remaining portion was largely driven by deterioration in our expectations of the macroeconomic environment.

轉到幻燈片 9 上關於我們津貼的討論。本季度，我們增加了 3.85 億美元的津貼，我們的準備金率提高了 25 個基點，達到 6.8%。準備金率的上升是由兩個因素驅動的。大約 10 個基點反映了我們通常在第四季度經歷的季節性交易餘額的流失。其餘部分主要是由於我們對宏觀經濟環境的預期惡化。

We increased our expectations for the 2023 year-end employment rate to the midpoint of our 4.5% to 5% range. This change reflects the potential for a reduction in lending impacting economic growth. We will continue to monitor the macroeconomic conditions and make adjustments to our expectations.

我們將 2023 年年底就業率的預期上調至 4.5% 至 5% 區間的中點。這一變化反映了影響經濟增長的貸款減少的可能性。我們將繼續監測宏觀經濟狀況並調整我們的預期。

Looking at Slide 10. Our common equity Tier 1 for the period was 12.3%, and we repurchased $1.2 billion of common stock during the quarter. The net unrealized loss on our AFS securities portfolio at the end of the quarter was $45 million. The impact on our regulatory capital, if our OCI opt-out were not allowed would have been about 20 basis points.

看看幻燈片 10。我們在此期間的一級普通股為 12.3%，我們在本季度回購了 12 億美元的普通股。本季度末我們的 AFS 證券投資組合的未實現淨虧損為 4500 萬美元。如果不允許我們的 OCI 選擇退出，對我們監管資本的影響將約為 20 個基點。

Our capital position remains robust and well ahead of regulatory requirements. We continue to prioritize investment in strong organic growth and returning excess capital to shareholders. Included in our press release was the announcement that our Board of Directors approved a new $2.7 billion share repurchase program for the 5 quarters ending June 2024 and increased our common stock dividend by 17% to $0.70 per share.

我們的資本狀況依然穩健，遠遠領先於監管要求。我們繼續優先投資於強勁的有機增長，並將過剩資本返還給股東。我們的新聞稿中包括一項公告，即我們的董事會批准了一項新的 27 億美元的股票回購計劃，適用於截至 2024 年 6 月的五個季度，並將我們的普通股股息增加 17% 至每股 0.70 美元。

Including on Slide 11 with our outlook. Following the strong first quarter performance, we are raising our expectations for loan growth this year to be low to mid-teens. There is no change to our NIM forecast. We are maintaining our guidance for operating expenses to be less than 10%. However, we do see risk of upward pressure on this from collection and customer service expense related to growth in our lending and deposit accounts and professional service support and continued investment in technology.

包括幻燈片 11 和我們的展望。繼第一季度的強勁表現之後，我們將今年的貸款增長預期上調至 15% 左右。我們的 NIM 預測沒有變化。我們將運營費用的指導方針維持在 10% 以下。然而，我們確實看到了與我們的借貸賬戶增長、專業服務支持和持續技術投資相關的收款和客戶服務費用帶來的上行壓力風險。

We are targeting our expected range of net charge-offs to 3.5% to 3.8% and based on our current delinquencies and roll rates. This represents a reduction to the top end of the range by 10 basis points. Finally, as mentioned, our Board of Directors approved a new share repurchase authorization. We have returned substantial excess capital over the past 2 years, and we anticipate moving towards a more standard cadence of share buybacks over the second half of this year.

根據我們目前的拖欠率和滾動率，我們將預期的淨沖銷範圍定為 3.5% 至 3.8%。這表示該範圍的上限減少了 10 個基點。最後，如前所述，我們的董事會批准了一項新的股份回購授權。過去 2 年，我們返還了大量過剩資本，我們預計今年下半年將朝著更標準的股票回購節奏邁進。

To conclude, our first quarter results have given us significant momentum into this year, and we're well positioned to deliver on our financial objectives. With that, I'll turn the call back to our operator to open the line for Q&A.

總而言之，我們第一季度的業績為我們今年帶來了巨大的動力，我們已準備好實現我們的財務目標。有了這個，我會把電話轉回給我們的接線員打開問答線。

(Operator Instructions)

（操作員說明）

And we'll take our first question from Sanjay Sakhrani with KBW.

我們將接受來自 KBW 的 Sanjay Sakhrani 的第一個問題。

John, quick question on the reserve commentary you had. Just to be clear, I know you guys had a waiting of scenarios and it sounds like the low end went from 4.5% to 4.75%. When we average that out, between all the scenarios. Does that take you above the 5% unemployment rate assumption? Or how should we think about that? And also just in terms of the narrowing of the range of the charge-offs this quarter, was that more because the unemployment rate hasn't necessarily panned out the way you expected it to, meaning it's coming in better?

約翰，關於你的保留評論的快速提問。需要明確的是，我知道你們已經在等待場景，聽起來低端從 4.5% 到 4.75%。當我們對所有場景進行平均時。這是否使您高於 5% 的失業率假設？或者我們應該如何考慮？而且就本季度沖銷範圍的縮小而言，這是否更多是因為失業率不一定像您預期的那樣平息，這意味著它正在好轉？

Yes. Thanks, Sanjay. Yes, I'll start with the reserve portion of the question and then swing over to the charge-off aspect. So as we mentioned, we've ran a number of different scenarios. So we looked at unemployment ranges from 3.5% to north of 6%. We centered around a range between 4.5% and 5% for 2023 and then a slight improvement in 2024. And that was essentially the driver of the increase in the reserve rate outside of the 10 basis points I talked about in my prepared remarks related to kind of transactors running off as they typically do in the first quarter. So hopefully, that clarifies your question or clarify any questions you have on reserves.

是的。謝謝，桑傑。是的，我將從問題的保留部分開始，然後轉到沖銷方面。所以正如我們提到的，我們已經運行了許多不同的場景。因此，我們研究了從 3.5% 到 6% 以上的失業率範圍。我們以 2023 年的 4.5% 和 5% 為中心，然後在 2024 年略有改善。這基本上是我在準備好的與實物相關的評論中談到的 10 個基點之外的準備金率增加的驅動因素的交易者像他們通常在第一季度所做的那樣流失。希望這能澄清您的問題或澄清您對儲備金的任何疑問。

Related to charge-offs, so there's a couple of factors there. The first and what I would say is the most important is that the portfolio is performing almost exactly as we expected it to in terms of a charge-off, roll rates and delinquencies. So we're generally pleased with that. As each month and quarter goes by, we have better line of sight to what we expect the total year to be.

與沖銷有關，所以有幾個因素。第一個也是我要說的最重要的一點是，投資組合在沖銷、滾動率和拖欠方面的表現幾乎完全符合我們的預期。所以我們通常對此感到滿意。隨著每個月和每個季度的過去，我們對全年的預期情況有了更好的了解。

Our internal kind of roll rate models basically can take a very, very good look at 6 months forward, and then we move to more advanced models for anything beyond that. So as the first quarter passed through great line of sight through September. And then beyond September, we've relied on our analytical models. So that's essentially the reason why we're able to tighten the charge-off guidance from the upper end. And each quarter, we'll give an update on that certainly.

我們內部的滾動率模型基本上可以非常非常好地觀察未來 6 個月，然後我們轉向更高級的模型來處理超出此範圍的任何事情。因此，隨著第一季度通過 9 月份的巨大視線。然後在 9 月之後，我們依賴於我們的分析模型。因此，這基本上就是我們能夠從高端收緊沖銷指導的原因。每個季度，我們都會對此進行更新。

Our next question will come from Moshe Orenbuch with Credit Suisse.

我們的下一個問題將來自瑞士信貸的 Moshe Orenbuch。

Great. I guess, first, you talked about kind of slowing of new account growth. Could you kind of, Roger, perhaps drill down a little more into that the drivers, I guess, in terms of what you're seeing either in the competitive environment or in the consumer kind of credit environment?

偉大的。我想，首先，你談到了新客戶增長的放緩。羅傑，你能不能更深入地了解驅動因素，我想，就你在競爭環境或消費者信貸環境中看到的情況而言？

Yes. So I'll start the credit -- the competitive environment remains robust, right? Most of our key competitors in the card business are the larger money center banks, well capitalized a lot of deposits. So cards tends to always be competitive. I think what you're seeing are the results of some of the changes we've made in credit policy. We've talked about tightening at the margin and then also some very tough comps over the growth we saw last year. So we feel really good about the new accounts we're booking, but also believe our credit policy is appropriate for the current environment.

是的。所以我要開始相信——競爭環境依然強勁，對吧？我們在卡業務中的大多數主要競爭對手都是較大的貨幣中心銀行，擁有大量存款。所以卡總是有競爭力的。我認為你所看到的是我們在信貸政策上所做的一些改變的結果。我們談到了邊際收緊，然後也談到了我們去年看到的增長的一些非常艱難的補償。因此，我們對我們預訂的新賬戶感覺非常好，但也相信我們的信貸政策適合當前環境。

Got it. And maybe can you talk, John, maybe talk a little bit more about the expense comment that you made, how much of that would be tied to revenue growth if expenses were higher.

知道了。也許你能談談，約翰，也許多談談你所做的費用評論，如果費用更高，其中有多少與收入增長有關。

Yes. So as I said in the prepared remarks, we we've maintained a less than 10% guidance, although we're seeing a little bit of pressure on those lines I mentioned. So in terms of marketing, what we said in January was that we expected marketing to be up double digits. We still expect that to be the case despite the reduction in the rate of growth of new accounts, we are still seeing good opportunities to generate positive account growth with an appropriate risk tolerance. The other portion of that marketing spend will be to roll out the cash back debit program, which we anticipate to be rolled out late in the second quarter, maybe early in the third quarter. So we're going to put some substantial dollars behind that to generate some activity, both new account generation as well as awareness of the product and the product features that we think will help build -- continue to build our strong deposit franchise.

是的。因此，正如我在準備好的發言中所說，我們一直保持著不到 10% 的指導，儘管我們看到我提到的那些方面有一點壓力。因此，在營銷方面，我們在 1 月份所說的是我們預計營銷將增長兩位數。儘管新賬戶的增長率有所下降，但我們仍然預計情況會如此，我們仍然看到在適當的風險承受能力下產生正賬戶增長的好機會。營銷支出的另一部分將用於推出現金返還借記計劃，我們預計該計劃將在第二季度末或第三季度初推出。因此，我們將投入大量資金來產生一些活動，包括新賬戶的產生以及我們認為將有助於建立的產品和產品功能的意識 - 繼續建立我們強大的存款特許經營權。

Our next question will come from Bob Napoli with William Blair.

我們的下一個問題將來自 Bob Napoli 和 William Blair。

The slowdown in spend growth that you called out in the month of April. I was wondering if you could give -- I know it's tough comps versus a year ago. But just any color on what you're seeing on that front? And then any change in your view of the health of the consumer?

您在 4 月份提到的支出增長放緩。我想知道你是否可以給予——我知道與一年前相比這很難。但是你在前面看到的東西有什麼顏色嗎？那麼您對消費者健康的看法有什麼變化嗎？

Yes. So I would say that the slowdown is pretty broad-based and is really a continuation of the trend. If you look at the quarter itself, overall sales growth was a little over 9%. But March, it had dropped to 4%. So broad-based across all categories, I think some of it is just a reduction in the pressures from inflation. But also you've got some tough comps in terms of last April, sales were up 22% year-over-year. For us, the most important thing for the consumers, the strength of the job market, and that remains pretty robust. So while we are tightening credit and continuing along that, overall, the consumer is still holding up pretty well.

是的。所以我想說放緩的範圍很廣，而且確實是趨勢的延續。如果你看一下本季度本身，整體銷售額增長略高於 9%。但在 3 月份，它已經下降到 4%。所有類別的基礎如此廣泛，我認為其中一些只是減輕了通貨膨脹的壓力。但就去年 4 月而言，你也有一些艱難的表現，銷售額同比增長 22%。對我們來說，對消費者來說最重要的是就業市場的實力，而且仍然非常強勁。因此，儘管我們正在收緊信貸並繼續這樣做，但總體而言，消費者仍然保持良好狀態。

Great. Then just any more color on the cash back debit product and what do you believe that will, I guess, do for you strategically? Just any thoughts on -- I know you guys have been doing a lot of work on it over the years, and it seems like you're ready to really roll with it.

偉大的。那麼現金返還借記產品上的任何更多顏色，我想，您認為這會在戰略上為您做什麼？任何想法——我知道你們這些年來一直在做很多工作，看起來你們已經準備好真正地使用它了。

Yes. No, that -- it's a product we're really excited about. Offering 1% cash back on debit transactions is virtually unique. It's something that no big bank can match. We take advantage of having a proprietary payments network and one of the outcomes from the pandemic is consumers even for their primary checking or debit account are a lot more comfortable dealing with the direct bank. So this is going to be a critical initiative, not just for this year, but for many years to come. And part of our transition to being way more than credit cards, personal loans, student loans, home equity, but being the true leading digital bank.

是的。不，那是我們非常興奮的產品。在藉記交易中提供 1% 的現金返還幾乎是獨一無二的。這是任何一家大銀行都無法比擬的。我們利用擁有專有支付網絡的優勢，大流行的結果之一是消費者即使是他們的主要支票或借記賬戶也更願意與直接銀行打交道。因此，這將是一項至關重要的舉措，不僅適用於今年，而且適用於未來許多年。我們轉型的一部分不僅僅是信用卡、個人貸款、學生貸款、房屋淨值，而是真正領先的數字銀行。

Our next question will come from Rick Shane with JPMorgan.

我們的下一個問題將來自摩根大通的 Rick Shane。

Roger, when you look at the credit outlook and you updated the NCO guidance, I'm curious about some of the puts and takes you see in terms of sort of the internals of numbers, whether it's roll rates, utilization, payment rates. What do you see out there that is the most constructive and what's your -- what's the factor that gives you the most pause?

羅傑，當你查看信用前景並更新 NCO 指南時，我對一些看跌期權感到好奇，並帶你從數字的內部來看，無論是展期利率、利用率、支付率。你認為那裡最有建設性的是什麼，你的 - 什麼是讓你最猶豫的因素？

Yes. It varies for new accounts versus what we look for in our portfolio. For the portfolio side, yes, it's hard to pick an individual factor given the complexity of the models we use. But certainly, overall levels of indebtedness, their behavior in terms of payments, the amount of payment, we even look at when a payment comes in during the month. So given that we're still focused on growth, I would say, in general, the consumers are doing well, but we have continued to tighten and it's something we look at every account, every day across all of our different products.

是的。新賬戶與我們在投資組合中尋找的賬戶不同。對於投資組合方面，是的，鑑於我們使用的模型的複雜性，很難選擇一個單獨的因素。但可以肯定的是，總體債務水平、他們在付款方面的行為、付款金額，我們甚至會查看當月付款的時間。因此，鑑於我們仍然專注於增長，我想說，總的來說，消費者表現良好，但我們繼續收緊，這是我們每天在所有不同產品中查看每個帳戶的內容。

Got it. And is there one metric you might point to that kind of your -- when you get your daily reports, you scan to right away to -- because it's a concern for you?

知道了。有沒有一個指標你可以指出你的那種 - 當你得到你的每日報告時，你會立即掃描 - 因為它是你的一個問題？

Yes. So you may find it hard to believe, but there are very few numbers I look at on a daily basis. I'm lucky to have an amazing team. And so I can look at it a little less frequently. But you can't point to a single number. We have kind of a composite behavioral score that I see on a lot of our internal risk reporting. But again, there are literally countless variables in some of our most complex machine learning models that are evaluating portfolio credit.

是的。所以你可能會覺得難以置信，但我每天看的數字很少。我很幸運擁有一支出色的團隊。這樣我就可以減少查看它的頻率。但是你不能指向一個數字。我在很多內部風險報告中都看到了一種綜合行為評分。但同樣，在我們評估投資組合信用的一些最複雜的機器學習模型中，確實存在無數變量。

Our next question will come from Betsy Graseck with Morgan Stanley.

我們的下一個問題將來自摩根士丹利的 Betsy Graseck。

This is Jeff Adelson on for Betsy. John, I just wanted to follow up on the comment about the potential for a reduction in lending impacting economic growth I know that was more of a macro overlay comment, but just wanted to understand maybe where you think Discover is going to fit into that potential tightening regime? I know you're already doing some tightening, slowing account growth on your side, but just wondering, do you see yourself at some point this year taking a more meaningful cut, maybe what would cause you to revisit the loan growth that you're seeing today?

這是 Betsy 的 Jeff Adelson。約翰，我只是想跟進有關減少貸款影響經濟增長的可能性的評論，我知道這更像是宏觀疊加評論，但我只是想了解您認為 Discover 將在哪些方面適應這種潛力收緊制度？我知道你已經在採取一些緊縮措施，放慢你這邊的賬戶增長，但只是想知道，你是否認為自己在今年的某個時候會進行更有意義的削減，也許什麼會導致你重新審視你正在今天見？

Yes, thanks for the question, Jeff. So as we look at loan growth for 2023, we feel very, very positive, and that's why we moved the loan growth range up a bit. So in terms of the overall lending environment and what would trigger additional cuts, it would be meaningful changes to the unemployment outlook, meaningful changes in the number of job openings and then further signs of stress within the consumers.

是的，謝謝你的問題，傑夫。因此，當我們審視 2023 年的貸款增長時，我們感到非常非常積極，這就是為什麼我們將貸款增長幅度上調了一點。因此，就整體貸款環境以及觸發進一步削減的因素而言，失業前景將發生有意義的變化，職位空缺數量將發生有意義的變化，然後是消費者壓力的進一步跡象。

So that would -- within the portfolio itself, it would be payment rates, timing of payments. We take a look at flow rates from one bucket to another. So those would all be certainly signs as well as kind of the broader -- a broader indications of delinquency and the rate of charge-off on a vintage basis.

因此，在投資組合本身內，這將是支付率、支付時間。我們看一下從一個桶到另一個桶的流量。因此，這些肯定都是跡象，也是更廣泛的跡象——更廣泛的拖欠跡象和基於年份的沖銷率。

But as we look at things right now, employment I believe, will continue to be strong, right? So we have strong growth in the health care sector, manufacturing sector, defense, oil and gas, and onshoring of supply chain continues. So my sense is that we're not going to have any seismic changes unemployment despite the fed tightening action. So that means that we'll look at -- continue to look at things around the margins and make good calls to ensure that the accounts we're putting on are profitable.

但就我們目前的情況來看，我相信就業將繼續強勁，對吧？因此，我們在醫療保健部門、製造業、國防、石油和天然氣領域實現了強勁增長，供應鏈的外包也在繼續。所以我的感覺是，儘管美聯儲采取了緊縮措施，我們的失業率不會發生任何翻天覆地的變化。因此，這意味著我們將關注 - 繼續關注利潤率周圍的事情並做出正確的決定以確保我們投入的賬戶是有利可圖的。

And the accounts that are in the portfolio that we have early warning triggers so that our customer service and collection folks can reach out to ensure that collections and cash flows remain strong.

投資組合中的賬戶我們有預警觸發器，以便我們的客戶服務和收款人員可以聯繫以確保收款和現金流保持強勁。

And one follow-up I just want to have on expenses. And technology investment. There's been a lot of focus out there on AI and some advances in that technology. I know Discover has been pretty nimble and investing on its own in that space. But just wondering, is there anything...

我只想進行一項後續行動以支付費用。和技術投資。人工智能和該技術的一些進步受到了很多關注。我知道 Discover 非常靈活，並且在該領域自行投資。但只是想知道，有什麼...

Jeff or operator? The line open.

傑夫還是接線員？線路開通。

Yes. His line is still open.

是的。他的線路仍然開放。

Okay. Jeff, I think we missed the last a little bit of your question, but I think it was essentially about the use of AI. So.

好的。傑夫，我想我們錯過了你問題的最後一點，但我認為這本質上是關於人工智能的使用。所以。

Yes. So why don't I -- I'll take that briefly. And Jeff or Betsy, we can follow up separately in the afternoon, if you like. So in terms of investing in technology. So there's 3 -- there's, I'll call it, 3 or 4 different strengths. The first is to ensure we have leading-edge capabilities, which would include machine learning, AI.

是的。那我為什麼不——我會簡短地講一下。 Jeff 或 Betsy，如果你願意，我們可以在下午單獨跟進。所以在技術投資方面。所以有 3 個——我稱之為 3 或 4 個不同的優勢。首先是確保我們擁有領先的能力，其中包括機器學習、人工智能。

Second is ensure that our core systems are robust and resilient. And third, around the network, making sure that our network continues to have leading edge or at a minimum market global capabilities. So those are the tiers and we continue to invest in those aspects as well as technology to support our overall compliance management system as we talked about in the prepared remarks. So overall, it's an area of investment. We're a digital institution. We need to continue to invest in technology to ensure that we keep capabilities, advancing. Okay. Thank you.

其次是確保我們的核心系統穩健且有彈性。第三，圍繞網絡，確保我們的網絡繼續具有領先優勢或至少具有全球市場能力。所以這些就是層次，我們將繼續在這些方面以及技術上進行投資，以支持我們在準備好的評論中談到的我們的整體合規管理系統。所以總的來說，這是一個投資領域。我們是一家數字機構。我們需要繼續投資於技術，以確保我們保持能力，不斷進步。好的。謝謝。

Our next question will come from Dominick Gabriele with Oppenheimer.

我們的下一個問題將來自 Dominick Gabriele 和 Oppenheimer。

I would imagine that Discover, given the prudence of the way you run your franchise has really strong KYC. And I think some of the fintech players are actually having some difficulty there. And so I'd love to hear you talk about your checklist for opening an account. And is there a difference for KYC when you issue a debit card versus extending credit with the credit card. And I just have a follow-up.

我可以想像 Discover，考慮到您經營特許經營方式的審慎性，它具有非常強大的 KYC。我認為一些金融科技公司實際上在這方面遇到了一些困難。因此，我很想听聽您談論您的開戶清單。當您發行借記卡與使用信用卡提供信貸時，KYC 是否有區別？我只是有一個跟進。

Yes. Great question. So AML, BSA, KYC is one element of compliance. There are many others that we focus on. First thing I'd say is our task might be a little easier just given that we don't handle much cash, not having branches. We don't have huge private net worth operations, much outside the U.S. But it is a key area of focus, there's a pretty big overlap between what we're required to do from a KYC standpoint and actually what we do ourselves to tackle fraud. A huge amount of the new fraud attacks do come via identity theft. And while there are sort of nuanced differences by product, very, very similar in terms of what we do when someone is opening a new credit card account versus opening a checking or a debit account.

是的。很好的問題。所以 AML、BSA、KYC 是合規性的要素之一。我們還關注許多其他方面。我要說的第一件事是我們的任務可能會更容易一些，因為我們沒有處理太多現金，也沒有分支機構。我們在美國以外的地方沒有大量的私人資產淨值業務，但這是一個關鍵的重點領域，從 KYC 的角度來看，我們需要做的事情與我們自己為應對欺詐所做的事情之間存在很大的重疊.大量新的欺詐攻擊確實來自身份盜用。雖然產品之間存在細微差別，但就我們在開設新信用卡賬戶與開設支票或借記賬戶時所做的工作而言，非常非常相似。

Okay. And I guess, kind of a double question here. But is -- how closely aligned is your CECL unemployment rate and thus, reserve outlook correlated with your net charge-off guidance. Is there a possibility that, I mean, you had mentioned before that you don't expect unemployment rate to rise very much. Is there a chance that there could be actually a disconnect between the CECL reserve and company NCO outlooks?

好的。我想，這裡有點雙重問題。但是——你的 CECL 失業率有多緊密，因此，儲備前景與你的淨註銷指導相關。有沒有可能，我的意思是，你之前提到過你預計失業率不會上升太多。 CECL 儲備和公司 NCO 前景之間是否有可能實際上脫節？

So yes, we have a process that we take great pains to make sure there's no disconnects between our outlook on kind of charge-offs over, call it, a 3-quarter or 4-quarter period and the CECL reserves, which is life of loan losses, which would include charge-offs through the life of the relationship. And the modeling systems that we use are essentially the same. Same tools, same people kind of managing those and a bunch of work to ensure that the organization. So each of the functions, credit and risk management systems and finance and accounting are on the same page in terms of what we're trying to accomplish here.

所以，是的，我們有一個過程，我們會竭盡全力確保我們對沖銷的展望（稱為 3 季度或 4 季度期間）與 CECL 儲備之間沒有脫節，這是生命週期貸款損失，包括整個關係期間的沖銷。我們使用的建模系統本質上是相同的。相同的工具，相同的人員管理這些工具和大量工作以確保組織。因此，就我們要在這裡完成的工作而言，每個功能、信用和風險管理系統以及財務和會計都在同一頁面上。

So there's no chance to disconnect here at Discover. I will say that the difference in terms of the tightening of our charge-off outlook in terms of updated guidance and what happened in the reserve has a couple of factors that are at play there. The first is we're talking about a 3-quarter period of forecasting on the charge-offs. And we gave a fairly wide range, which we intend to tighten as each quarter passes. On the reserves, we take a number of different factors, including the macro environment portfolio. And then there's certainly a level of management judgment that we use to ensure that we have an appropriate reserve under financial accounting standards. So that's essentially a quick sketch of the process that we use.

所以沒有機會在 Discover 上斷開連接。我要說的是，在更新指導方面收緊我們的沖銷前景方面的差異以及儲備中發生的事情有幾個因素在起作用。首先是我們談論的是 3 個季度的沖銷預測。我們給出了一個相當廣泛的範圍，我們打算在每個季度過去時收緊。在儲備方面，我們考慮了許多不同的因素，包括宏觀環境組合。然後肯定有一定程度的管理判斷，我們使用它來確保我們在財務會計準則下有適當的準備金。所以這基本上是我們使用的過程的快速草圖。

Our next question will come from Mihir Bhatia with Bank of America.

我們的下一個問題將來自美國銀行的 Mihir Bhatia。

This is Nate Rich on for Mihir Bhatia. Quick question for me. Are you seeing any changes to the credit quality for new applicants? I understand that you're tightening credit and underwriting. But just curious to see how those consumers are asking for loans now versus a year or 2 ago?

這是 Mihir Bhatia 的 Nate Rich。快速問我一個問題。您是否發現新申請人的信用質量有任何變化？我了解到您正在收緊信貸和承保。但只是想看看這些消費者現在與一兩年前相比如何申請貸款？

Yes. I mean it's a tricky question to answer because it varies by channel. Obviously, we did quite a lot of preapproved marketing. So we kind of set the criteria who applies and even within our nonpreapproved channels, we tend to be targeted. So I haven't seen, I would guess, a huge difference in terms of applicant profile, but our new account profile has tended to improve as we've tightened credit.

是的。我的意思是這是一個很難回答的問題，因為它因渠道而異。顯然，我們做了很多預先批准的營銷。因此，我們設置了適用的標準，甚至在我們未預先批准的渠道內，我們也往往成為目標。所以我猜，我沒有看到申請人資料方面的巨大差異，但隨著我們收緊信貸，我們的新帳戶資料往往會有所改善。

Okay. And then as a quick follow-up, can you just talk about the performance? Like how are card loan business from like 2020 or 2022 performing versus the loans prepandemic?

好的。然後作為快速跟進，你能談談表現嗎？比如 2020 年或 2022 年的信用卡貸款業務與大流行前的貸款相比表現如何？

Yes. I think in general, John mentioned, all of the vintages are performing as expected. And so total losses are still normalizing in line with what we forecast. So I would say continued strong performance across the board. And we haven't seen huge differences in behavior by vintage.

是的。我認為總的來說，約翰提到，所有年份的表現都符合預期。因此，總損失仍在正常化，符合我們的預測。所以我想說全面持續強勁的表現。而且我們還沒有看到不同年份的行為存在巨大差異。

Our next question will come from Mark DeVries with Barclays.

我們的下一個問題將來自巴克萊銀行的 Mark DeVries。

(inaudible)

（聽不清）

Mark, I think your line is open. Chelsea, we'll come back to Mark offline.

馬克，我想你的線路是開放的。切爾西，我們會在線下回到馬克身邊。

And as at this moment, there are no further questions in the queue. So I would like to turn it back over to management for any additional or closing remarks.

就目前而言，隊列中沒有其他問題。因此，我想將其轉回給管理層，以徵求任何補充意見或結束意見。

Great. Well, if there are any additional questions, please reach out to us here at the IR team. And thanks very much. Have a great day.

偉大的。好吧，如果還有任何其他問題，請在 IR 團隊聯繫我們。非常感謝。祝你有美好的一天。

Thank you, ladies and gentlemen. This does conclude today's conference, and we appreciate your participation. You may disconnect at any time.

謝謝你們，女士們，先生們。今天的會議到此結束，感謝您的參與。您可以隨時斷開連接。