COLUMBUS, Ohio, Feb. 26, 2026 (GLOBE NEWSWIRE) -- Bread Financial Holdings, Inc. (NYSE: BFH) (“Bread Financial” or the “Company”) today announced that its Board of Directors (the “Board”) has approved a $600 million increase to the Company’s existing share repurchase authorization. As of December 31, 2025, the Company had $240 million remaining on its open share repurchase authorization. The Company made an additional $75 million of repurchases to-date during 2026, meaning that $165 million of share repurch ...

Core Insights - Bread Financial is experiencing a resilient middle-America consumer base, with gradual improvement in credit trends and an anticipated inflection toward loan growth as new partner programs scale [4] Credit Metrics - January credit results were described as "good numbers" and aligned with expectations, with a seasonal increase expected in February and metrics projected to move "near 8" [1] - Customers have adjusted their household budgets due to compounded inflation of 30% to 35% post-COVID, leading to a cautious approach in spending [2] - The company expects continued improvement in credit quality and a resumption of spending as inflation moderates and the labor market remains stable [2] Customer Demographics - Bread primarily serves near-prime to prime customers, with new vintages underwritten having an average income of approximately $95,000, while the overall portfolio is just under $80,000 [3] Loan Growth and Partner Programs - Loan growth is expected to inflect as partner programs like Raymour & Flanigan, Cricket Wireless, and Vivint scale, with guidance for low single-digit average loan growth and higher ending loans later in the year [6][7] - The company reported flat year-over-year growth in January, which is viewed as an early sign of an expected inflection to growth [6] Pricing and Margin - Pricing changes implemented since early 2024 are expected to protect net interest margin (NIM), which is projected to remain flat to slightly higher [5][11] - Operational savings are being reinvested into technology and AI initiatives, supporting the goal of positive operating leverage as revenue grows [11] Capital Management - The company plans to issue up to $300 million in preferred stock and is pursuing a merger of its two legacy banks to enhance funding flexibility [5][13] - Bread has reduced its debt from $900 million at the start of last year to $500 million at year-end and has $240 million remaining in share repurchase authorization [14] Product Offerings - Bread Pay and buy now, pay later (BNPL) services are expanding, catering to consumers who prefer to pay over time but may not qualify for traditional credit [9][10] - The existing portfolio is expected to see gradual improvement due to credit strategies and consumer adaptation, with new vintages carrying lower loss rates [9]

Core Insights - Bread Financial has made significant progress in strengthening its balance sheet, including debt reduction and improving tangible value, marking a successful transformation post-COVID [1][5] - The company reported that January performance showed favorable credit trends, with losses and delinquencies improving, while loan growth remained flat, indicating potential stabilization [2][6] - Bread Financial has diversified its product offerings beyond private-label cards to include co-brand, direct-to-consumer, and buy now, pay later (BNPL) products, enhancing its market position [4][8] Financial Performance - Non-interest expenses for the fourth quarter were reported at $500 million, with expectations for a slight decrease in the first quarter [1] - The company ended the year with approximately $8.5 billion in direct-to-consumer deposits, aiming for deposits to constitute 50% of total funding [5][17] - Management anticipates long-term loss rates around 6% and reserves near 10%, with expectations for low single-digit loan growth over time [6][14] Customer Targeting - Bread Financial targets "Middle America" consumers, with an average income of about $94,000, who have shown resilience in adapting their spending behavior amid economic challenges [7] - The company emphasizes that its customer base does not primarily include superprime or subprime consumers, focusing instead on a more stable middle-income demographic [7] Product and Market Expansion - The company has expanded its product set to include multiple offerings, providing partners with more choices and increasing the pool of eligible consumers [9] - Bread Financial operates across various verticals, including travel and entertainment, home improvement, and electronics, enhancing its market reach [16] Strategic Initiatives - The management is focused on responsible growth, maintaining positive operating leverage, and continuing technology transformation, including cloud migration and AI applications [18] - The partner pipeline is described as robust, with top 10 partners locked through 2028, indicating strong future collaboration opportunities [15][17]

Financial Performance - As of December 31, 2025, the company had $18.8 billion in credit card and other loans from approximately 34 million open accounts, with an average balance of $1,047 for accounts with outstanding balances[23]. - Customer spending on co-brand credit cards comprised approximately 52% of total credit sales, while spending on private label credit cards accounted for about 43%[27][28]. - The average outstanding balance for direct-to-consumer credit cards was $2,295 for the year ended December 31, 2025[34]. - The average outstanding co-brand credit card account balance was $1,821 for the year ended December 31, 2025[27]. - As of December 31, 2025, the Delinquency rate was 5.8%, and the Net principal loss rate for the full year was 7.7%[142]. - The five largest credit card programs accounted for approximately 49% of Total net interest and non-interest income, with each of Signet Jewelers, Ulta Beauty, and Victoria's Secret & Co. contributing 10% or more[149]. - The company expects growth from new and acquired credit card programs, but these may result in increased portfolio losses and negatively impact profitability[151]. - The company faces risks from macroeconomic conditions, including high interest rates and persistent inflation, which could adversely affect consumer spending and credit behavior[141]. - The current economic environment may disproportionately impact the company due to a higher proportion of private label credit card accounts among its customer base[141]. - The company relies on models for risk management, which may not accurately predict future charge-offs, potentially leading to unexpected losses[153]. Deposits and Funding - Retail deposits grew 11% from $7.7 billion as of December 31, 2024, to $8.5 billion as of December 31, 2025, representing 48% of total funding sources[39]. - As of December 31, 2025, the company had $13.9 billion in deposits, with approximately $7.7 billion in non-maturity savings deposits and approximately $6.2 billion in certificates of deposit[196]. - DTC deposits grew 11% from $7.7 billion as of December 31, 2024, to $8.5 billion as of December 31, 2025, representing 48% of total funding sources[196]. - The company faces intense competition in attracting and retaining deposits, which is influenced by rates paid on deposits, customer service quality, and digital banking capabilities[196]. - The company’s ability to attract retail deposits is highly dependent on product offerings, financial health, and reputability of business practices[196]. - Any inability to grow or maintain deposit levels could materially adversely affect the company's liquidity, business growth, and profitability[196]. Regulatory Environment - The company operates under extensive federal and state regulations, which could materially affect its operations and financial condition[65]. - The Consumer Financial Protection Bureau (CFPB) supervises and examines the Banks due to their total assets exceeding $10 billion[69]. - The merger is expected to streamline regulatory complexity and improve access to retail deposit funding markets[68]. - The planned merger of CB with CCB is expected to occur in the second half of 2026, pending regulatory approval, with CCB projected to have total assets of approximately $21.4 billion and total deposits of approximately $14.1 billion as of December 31, 2025[68]. - The Federal Deposit Insurance Corporation (FDIC) insures the deposits of the Banks up to a maximum of $250,000 per depositor per ownership category[85]. - The FDIC employs a risk-based assessment system for insurance premiums based on the risk profile of the institution's assets and liabilities[86]. - The regulatory environment remains uncertain, with potential for increased scrutiny and enforcement actions from federal and state agencies[212]. - Changes in legislation could create a complex regulatory landscape, affecting the company's ability to charge fees and offer certain products[213]. - The recent Tenth Circuit decision may encourage other states to adopt similar interest rate cap legislation, further complicating the regulatory environment[215]. - The company may be required to implement changes in business practices due to regulatory supervision, impacting operational flexibility[216]. Technology and Innovation - The company utilizes machine learning and AI technology in its marketing and data analytics to enhance customer engagement and drive revenue growth[49]. - Recent improvements in digital and mobile capabilities include API enhancements and a fully integrated mobile app, aimed at providing a seamless customer experience[50]. - The Enhanced Digital Suite has improved credit sales conversion rates and average purchase values by simplifying the credit application process for customers[51]. - The company continues to diversify its product mix, with co-brand credit card programs showing higher credit sales per account and improved credit risk mix[21]. - The Bread Pay products, including installment loans and "split-pay" offerings, are designed to enhance growth prospects across various industries[35]. Employee Engagement and Culture - As of December 31, 2025, the company employed approximately 6,000 associates worldwide, primarily in the United States[119]. - Over 90% of associates view flexible work arrangements as a competitive advantage, enhancing engagement and productivity[120]. - 89% of associates feel confident in their ability to make informed decisions about their health and finances[121]. - The company has expanded mobility programs, including internships and rotational programs, to support associates' career goals[123]. - 86% of associates feel a sense of belonging within the company, reflecting its commitment to an inclusive culture[125]. Risk Management - The company employs a proprietary collection scoring algorithm to manage delinquent accounts, deploying targeted collection strategies based on risk assessment[47]. - The company faces risks related to the securitization of credit card loans, which is a significant funding source, and changes in market conditions could adversely affect operations[185]. - Early amortization events in securitization transactions could materially impact liquidity and the ability to fund new loans[188]. - The risk of fraudulent activity, particularly in digital sales channels, continues to increase, potentially impacting operating results and brand reputation[154]. - Fraud-related operational losses were $65 million for both 2024 and 2025, and $127 million for 2023, indicating a significant increase in fraud attacks in 2023[155]. - The company’s Allowance for credit losses is critical and may be insufficient to cover actual losses, influenced by the growth of the loan portfolio[156]. - The CECL model may create volatility in the Allowance for credit losses, potentially adversely affecting business and financial condition if increases are required[158]. Competition and Market Conditions - The competitive landscape includes traditional banks and fintechs, with increasing competition from non-traditional financial institutions and emerging technologies[62]. - Competition in the industry is intense, with significant risks from economic downturns and the performance of retail partners affecting demand for products and services[163]. - The financial performance of partners significantly impacts the company’s ability to generate new loans and income, with risks from partner bankruptcies or sales declines[166]. - Efforts to promote DTC credit cards may not yield expected results, impacting profitability due to increasing competition and costs[167]. - Reductions in interchange fees and regulatory changes could adversely impact interchange revenue and operational challenges[169]. Financial Obligations and Future Outlook - The company has $500 million of 6.750% senior notes and $400 million of 8.375% subordinated notes due in 2035, indicating future financing needs[183]. - The proposed Basel III "Endgame" rules could limit lending capacity from institutional lenders, impacting the company's ability to secure financing[183]. - Changes in market interest rates could negatively affect the company's profitability, as interest expenses may increase or decrease based on fluctuating rates[203]. - The trading price of the company's common stock may be volatile, influenced by operating results, earnings estimates, and general economic conditions[207]. - Future dividend payments and stock repurchases are subject to the discretion of the Board of Directors and may be affected by profitability and financial condition[209].

Core Viewpoint - The discussion features Perry Beberman, CFO of Bread Financial, highlighting the company's position as a major player in the credit card issuance market, particularly in private label, co-brand, and general purpose credit cards [1] Company Overview - Bread Financial is recognized as one of the largest credit card issuers in the industry [1] - The company primarily focuses on private label, co-brand, and general purpose credit cards, indicating a diverse product offering within the consumer finance sector [1] Industry Context - The consumer finance sector, particularly in credit card issuance, is characterized by significant competition and innovation, with companies like Bread Financial playing a crucial role [1]

Summary of Bread Financial Conference Call Company Overview - **Company**: Bread Financial (NYSE: BFH) - **Industry**: Consumer Finance, Credit Card Issuing Key Points Consumer Health and Economic Environment - Bread Financial primarily serves Middle America, focusing on near-prime to prime customers with an average income of approximately $95,000 for new vintages and just under $80,000 for the overall portfolio [3][4] - The company has observed a K-shaped economy, where consumers in the middle segment are adapting to elevated inflation, which has been around 30%-35% compounded since COVID-19 [4] - Consumers are making more deliberate purchasing choices, showing resilience despite some strain in the portfolio [5] Credit Quality and Loan Growth - January data indicated continued progress in credit quality, with expectations for credit losses to improve throughout 2026 [6][8] - The company anticipates average loan growth in the low single digits for the year, supported by new partner launches and tax refunds [12][14] - Tax refunds are expected to be a tailwind for consumers, potentially used for debt repayment or discretionary spending [10][11] Strategic Partnerships and Market Position - New partner launches in 2025, such as with Raymour & Flanigan and Cricket Wireless, are expected to contribute positively to loan growth [12][14] - Bread Financial is focused on maintaining a competitive edge by securing partnerships and exploring new opportunities in the market [15] Buy Now, Pay Later (BNPL) Segment - The BNPL segment is growing, now representing around 2% of outstanding loans and sales, appealing to consumers who may not qualify for traditional credit [17][19] - The company is working on white-labeled BNPL offerings with brand partners to enhance consumer engagement [18] Revenue and Margin Outlook - Pricing changes implemented in previous years are expected to support net interest margins, which are projected to remain flat to slightly up [21][22] - The company aims to achieve positive operating leverage by growing revenues faster than expenses [25] Operational Efficiency and AI Integration - Bread Financial has established a culture of operational excellence, generating tens of millions in savings annually, which are reinvested into technology and efficiency improvements [24] - The company has over 200 machine learning models in place and is exploring AI applications to enhance customer service and operational efficiency [35][38] Regulatory Environment and Capital Management - The company is cautious about potential price caps on credit cards, believing they could restrict credit access for many consumers [41] - Capital levels have improved significantly, with CET1 at 13%, and the company is focused on supporting profitable growth while returning capital to shareholders through buybacks [46][47] Future Outlook - Bread Financial expresses cautious optimism for 2026, anticipating continued credit improvement and a stable labor market, which could support consumer spending [49][50] - The company is committed to growing responsibly and profitably, focusing on enhancing customer service and expanding partnerships [48][50] Additional Insights - The merger of the two banks (Utah and Delaware) is aimed at improving funding flexibility and capital management [31][33] - The company is not currently focused on major disruptions but is adapting to changes in the market and consumer behavior [38]

Group 1 - The article does not provide any relevant content regarding company or industry insights [1]

Bread Financial Conference Call Summary Company Overview - **Company**: Bread Financial (NYSE: BFH) - **Industry**: Consumer finance and payments, focusing on private label card issuance, co-brand cards, proprietary cards, and buy now, pay later loans [1] Key Points and Arguments Financial Performance - **January Results**: Positive trends in January with flat loan growth and improved loss and delinquency rates. February is expected to see a seasonal increase in activity, approaching 8% [2] - **Expense Management**: Non-interest expenses were $500 million in Q4, expected to decrease slightly in Q1. Adjusted expenses exclude one-time charges from previous years [3] - **Loan Growth Outlook**: Anticipated low single-digit growth for the year, supported by new partnerships and improved credit quality [18] Customer Insights - **Customer Demographics**: Bread Financial primarily serves middle-income consumers with an average income of $94,000. The customer base is resilient despite economic challenges, adjusting spending habits due to inflation [9][10] - **Spending Behavior**: Consumers are making more budget-conscious choices, opting for lower-cost options while maintaining financial stability [10] Product Diversity and Partnerships - **Product Expansion**: Bread Financial has diversified its offerings beyond private label credit cards to include co-brand products, direct-to-consumer products, and buy now, pay later options [12][14] - **Partner Relationships**: The expanded product set enhances partnerships by providing more options for consumers, increasing revenue opportunities for partners [16] Market Dynamics and Competitive Landscape - **Pipeline and Competition**: The company has a robust pipeline for new partnerships, with opportunities in both de novo programs and existing partner renewals. Competition remains intense, but Bread Financial is well-positioned to leverage its expertise [39][41] - **Vertical Expertise**: Strong performance in verticals such as beauty, jewelry, and technology, with a focus on expanding into digital and home improvement sectors [43][44] Financial Strategy and Outlook - **Funding Strategy**: Significant progress made in refinancing debt, with a goal to increase direct-to-consumer deposits to 50% of total funding. The company aims to maintain a stable funding structure while exploring opportunities for preferred stock issuance [45][46] - **NIM Guidance**: Net interest margin (NIM) is expected to remain flat to slightly up, influenced by pricing changes and improvements in credit quality [49] Risks and Opportunities - **Macro Risks**: Potential impacts from tax refunds on consumer behavior and loan performance. The company is cautious in its guidance, accounting for various macroeconomic factors [24][25] - **Technology Transformation**: Ongoing tech transformation efforts, including migration to cloud services and AI integration, are seen as critical for future growth [53][58] Future Initiatives - **Focus Areas for 2026**: Emphasis on responsible growth, managing expenses, and leveraging technology to enhance customer service and underwriting processes [65][67] Additional Important Insights - **Consumer Behavior with Windfall Gains**: The use of tax refunds varies among consumers, with some opting to save, spend, or pay down debt, reflecting diverse financial strategies [27] - **AI Strategy**: Bread Financial is adopting a thoughtful approach to AI, focusing on governance, use cases, and ensuring returns on investments in technology [57][59] This summary encapsulates the key insights and strategic directions discussed during the conference call, highlighting Bread Financial's performance, market positioning, and future outlook.

Performance Update - Bread Financial Holdings, Inc. reported a net principal loss rate of 7.1% for January 31, 2026, down from 7.8% a year earlier, indicating improved credit performance [1] - The company experienced net principal losses of $111 million in January 2026, a decrease from $123 million in January 2025 [1] - The delinquency rate as of January 31, 2026, was 5.9%, compared to 6.1% in the previous year, reflecting a positive trend in loan performance [1] Company Overview - Bread Financial is a tech-forward financial services company that offers personalized payment, lending, and saving solutions to millions of U.S. consumers [2] - The company provides general purpose credit cards and savings products, aiming to empower customers and enhance their quality of life [2] - Bread Financial also supports growth for recognized brands in various sectors through private label and co-brand credit cards, offering value to shared customers [2] Company Milestone - In 2026, Bread Financial celebrates 30 years of success, highlighting its long-standing presence in the financial services industry [3]

Core Viewpoint - Bread Financial Holdings, Inc. is actively participating in the UBS Financial Services Conference, highlighting its commitment to engaging with investors and stakeholders in the financial services sector [1]. Company Participation - The company will have its Executive Vice President and Chief Financial Officer, Perry Beberman, participate in a fireside chat scheduled for February 11 at 12:10 p.m. ET, which will be broadcast live [1]. - The fireside chat will also be accessible through the company's investor relations website, with a replay available for 90 days post-event [2]. Company Overview - Bread Financial is a tech-forward financial services company that offers personalized payment, lending, and saving solutions to millions of U.S. consumers [3]. - The company provides various payment solutions, including general-purpose credit cards and savings products, aimed at empowering customers and enhancing their lifestyles [3]. - Additionally, Bread Financial supports growth for well-known brands in sectors such as travel, entertainment, health, beauty, jewelry, and specialty apparel through private label and co-brand credit cards [3]. Company Milestone - In 2026, Bread Financial celebrates 30 years of success, reflecting its long-standing presence and performance in the financial services industry [4].