Synchrony Financial ( SYF ) reported third-quarter net interest income of $4.609 billion, beating the consensus of $4.491 billion.

Net interest income increased 5.7% YoY, driven by higher interest and fees on loans, partially offset by an increase in interest expense from higher benchmark rates and higher interest-bearing liabilities.

Net revenue rose 9.8% to $3.814 billion. Net interest margin declined 32 basis points to 15.04%. Period-end loan receivables rose 4% to $102.2 billion, and purchase volume declined 4% to $45 billion.

Interest and fees on loans increased 7% year over year to $5.5 billion, driven by loan growth, policy changes, and lower payment rates, partly offset by higher reversals.

Synchrony’s average active accounts were flat at 70.4 million, but deposits grew 5% year over year to $82.3 billion in the quarter.

SYF returned $399 million in capital to shareholders, including $300 million in share repurchases and $99 million in common stock dividends.

Provision for credit losses was $1.60 billion, an increase of $109 million due to higher net charge-offs.

Net earnings increased 29% year over year to $789 million. The company reported EPS of $1.94, above the consensus of $1.81.

Synchrony’s return on assets increased 30 bps to 2.6%, while the efficiency ratio declined 200 basis points to 31.2%.

The estimated Common Equity Tier 1 ratio was 13.1%, compared to 12.8% in the prior year, and the estimated Tier 1 Capital ratio was 14.3%, compared to 13.6% in the prior year.

During the quarter, Synchrony added or renewed over 15 programs, including Dick’s Sporting Goods and Gibson. Extended its partnership with Dick’s, enhancing athlete rewards and digital services. Also launched a new payment system integrating CareCredit and Pets Best for insurance claim reimbursement.

“The unique combination of Synchrony’s industry expertise, proprietary data and analytics, and innovative digital capabilities is powering our trajectory forward, and we believe we are well-positioned to drive sustainable and strong risk-adjusted returns over the long-term,” commented Brian Wenzel, Synchrony’s Executive Vice President and Chief Financial Officer.

FY24 Outlook raised: Synchrony now expects EPS of $8.45 – $8.55 (prior $7.60 – $7.80) versus the $7.79 consensus; this assumes no late fee rule implementation in 2024.

Price Action: SYF shares are trading higher by 4.90% at $55.90 premarket at the last check Wednesday.