Synchrony Financial

Next item on our agenda is the reports from administration.

This is the proposed synchrony bank line of credit renewal.

And we have? Jeremy Smith, who we just reappointed to the Housing Authority.

Welcome,

We are looking at an absolutely massive valuation disconnect here.

Synchrony Financial sits right at the intersection of retail commerce and consumer lending in the US.

We're talking tens of millions of active accounts, deep foundational integrations with the biggest merchants on the planet, and dominant market share.

Yet the market seems terrified of it.

It is literally pricing the stock for structural decay.

But here is the major disconnect.

Synchrony is not decaying at all.

In fact, this business is currently generating a massive twenty-five point two percent return on tangible common equity.

I don't know if you've heard of it.

Synchrony Bank is the one who initiates it.

They only cover for cosmetic surgery and pet care.

It's kind of an odd combination, but that's what they do.

If you have a lot of cash in a checking account, if you don't need to keep that balance there, open up a high-yield savings account.

Two options, Goldman Sachs has a Marcus account and Synchrony Bank.

They're two online options.

You can open an account very quickly.

But on my phone, Venmo was willing to pay me $200 if I apply in the next two weeks and spend $1,000 or so in the next six months.

One could construct a range of per-account and usage-based payments from Synchrony Bank to PayPal, which makes this immediately incentive-compatible for PayPal.

As we previously covered, it is not the case that it needs to be immediately incentive compatible.

The marketing operations of financial services companies are sophisticated and model customer acquisition costs over portfolios.

All right.

Next item is our proposed renewal of the synchrony bank line of credit.

We have Mr. Jeremy Smith there with us today.

Welcome, Jeremy.

Great to be here.

Just have a short presentation for you today.

This is one that we do every couple of years, but it involves our synchrony bank loan renewal or line of credit renewal.

What this is, I'll just summarize with this slide, is this is our construction financing tool that we use for our housing programs as far as when we build new homes.