Bread Financial Announces Pricing of Private Offering of $500 Million of Senior Notes

Rhea-AI Summary

Bread Financial (NYSE: BFH) priced a private offering of $500 million aggregate principal amount of 6.750% senior notes due 2031, sold at 100% of principal. Closing is expected on Nov 6, 2025, producing approximately $493 million net proceeds after discounts and estimated expenses.

The company intends to combine the net proceeds with about $275 million cash on hand to redeem in full its outstanding $719 million aggregate 9.750% senior notes due 2029, with a conditional redemption date of Nov 7, 2025 (including make-whole premium) subject to customary closing conditions and a gross-proceeds condition.

Positive

• Issued $500M 6.750% senior notes due 2031
• Expected $493M net proceeds after fees
• Planned full redemption of $719M 9.750% notes due 2029

Negative

• Redemption conditioned on closing by 11:00 a.m. ET Nov 7, 2025
• Redemption will include a make-whole premium increasing cash outflow
• Notes were issued privately and are not registered, limiting public resale liquidity

Insights

Credit Markets Analyst

Bread Financial is refinancing higher-cost debt by issuing $500 million of 6.750% notes to fund redemption of 9.750% notes due 2029.

The company priced $500 million of 6.750% senior notes due 2031, expected to close on November 6, 2025, with approximately $493 million net proceeds after fees. Combined with about $275 million of cash on hand, the net proceeds are allocated to redeem in full the outstanding 9.750% senior notes due 2029, of which $719 million remains outstanding; the redemption is conditioned on receiving at least $500 million in gross proceeds by November 7, 2025.

The mechanics reduce headline coupon from 9.750% to 6.750% on the refinanced amount and shift funding to a longer maturity (2031), which should lower cash interest costs on the portion refinanced if the offering closes as described. Key execution risks are explicit and factual: the offering must close by the stated deadlines and satisfy customary closing conditions, and the redemption depends on achieving the gross proceeds threshold; monitor the closing on November 6, 2025 and the conditional redemption notice dated October 28, 2025 for confirmation within the next ten days.

COLUMBUS, Ohio, Oct. 28, 2025 (GLOBE NEWSWIRE) -- Bread Financial Holdings, Inc. (NYSE: BFH) (“Bread Financial” or the “Company”) announced today the pricing of its previously announced offering of $500 million in aggregate principal amount of its 6.750% senior notes due 2031 (the “Notes”), in a private offering that is exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”). The Notes will be sold at a price of 100% of the principal amount thereof. The closing of the issuance of the Notes is expected to occur on November 6, 2025, subject to customary closing conditions, and is expected to result in approximately $493 million in net proceeds to the Company, after deducting the initial purchasers’ discount and the Company’s estimated offering expenses.

The Company intends to use the net proceeds from the Notes offering, together with approximately $275 million of cash on hand, for the redemption in full (including the make-whole premium) of its outstanding 9.750% Senior Notes due 2029 (the “2029 Notes”) (of which there is $719 million aggregate principal amount outstanding).

On October 28, 2025, the Company sent a conditional notice to holders of its 2029 Notes that it intends to redeem all of the outstanding 2029 Notes on November 7, 2025 (the “2029 Notes Redemption”). The 2029 Notes Redemption is conditioned upon the consummation of the Notes offering resulting in gross proceeds of at least $500 million to the Company no later than 11:00 a.m. New York City time on November 7, 2025.

The Notes will be guaranteed, on a full, joint and several basis, by each of the Company’s domestic subsidiaries that guarantees the Company’s obligations under its existing senior notes and its senior credit facility.

The Notes will not be registered under the Securities Act, or any state securities laws. The Notes may not be offered or sold in the United States absent an effective registration statement or an applicable exemption from registration requirements under the Securities Act and applicable state securities laws. Accordingly, the Notes were offered only (A) to persons reasonably believed to be “qualified institutional buyers” under Rule 144A of the Securities Act or (B) outside the United States to non-U.S. persons in compliance with Regulation S under the Securities Act.

This news release shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. This news release shall not constitute an offer to purchase, or a redemption notice for, any of the 2029 Notes.

About Bread Financial®

Bread Financial® (NYSE: BFH) is a tech-forward financial services company that provides simple, personalized payment, lending and saving solutions to millions of U.S. consumers. The Company’s payment solutions, including Bread Financial general purpose credit cards and savings products, empower its customers and their passions for a better life. Additionally, the Company delivers growth for some of the most recognized brands in travel and entertainment, health and beauty, jewelry and specialty apparel through their private label and co-brand credit cards and pay-over-time products providing choice and value to their shared customers.

Forward-looking Statements
This news release contains forward-looking statements, including, but not limited to, statements related to the Notes offering described above. Forward-looking statements give the Company’s expectations or forecasts of future events and can generally be identified by the use of words such as “believe,” “expect,” “anticipate,” “estimate,” “intend,” “project,” “plan,” “likely,” “may,” “should” or other words or phrases of similar import. Similarly, statements that describe the Company’s business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements made regarding, and the guidance given with respect to, the Company’s anticipated operating or financial results, future financial performance and outlook, future dividend declarations or stock repurchases and future economic conditions.

The Company believes that its expectations are based on reasonable assumptions. Forward-looking statements, however, are subject to a number of risks and uncertainties that are difficult to predict and, in many cases, beyond its control. Accordingly, actual results could differ materially from the projections, anticipated results or other expectations expressed in this release, and no assurances can be given that the Company’s expectations will prove to have been correct. Factors that could cause the outcomes to differ materially include, but are not limited to, the following: macroeconomic conditions, including market conditions, inflation, interest rates, labor market conditions, recessionary pressures or concerns over a prolonged economic slowdown, and the related impact on consumer spending behavior, payments, debt levels, savings rates and other behaviors; global political and public health events and conditions, including significant shifts in trade policy, such as changes to, or the imposition of, tariffs and/or trade barriers and any economic impacts, volatility, uncertainty and geopolitical instability resulting therefrom, as well as ongoing wars and military conflicts, and natural disasters; future credit performance of the Company’s customers, including the level of future delinquency and charge-off rates; loss of, or reduction in demand for services from, significant brand partners or customers in the highly competitive markets in which the Company operates, including competition from new and non-traditional competitors, such as financial technology companies, and with respect to new products, services and technologies, such as the emergence or increase in popularity of agentic commerce, digital payment platforms and currencies and other alternative payment and deposit solutions; the concentration of the Company’s business in U.S. consumer credit; increases or volatility in the Allowance for credit losses that may result from the application of the current expected credit loss (CECL) model; inaccuracies in the models and estimates on which the Company rely, including the amount of the Company’s Allowance for credit losses and its credit risk management models; increases in fraudulent activity; failure to identify, complete or successfully integrate or disaggregate business acquisitions, divestitures and other strategic initiatives, including, with respect to divested businesses, any associated guarantees, indemnities or other liabilities; the extent to which the Company’s results are dependent upon brand partners, including brand partners’ financial performance and reputation, as well as the effective promotion and support of the Company’s products by brand partners; increases in the cost of doing business, including market interest rates; the Company’s level of indebtedness and inability to access financial or capital markets, including asset-backed securitization funding or deposits markets; restrictions that limit the ability of the Company’s subsidiary banks, Comenity Bank and Comenity Capital Bank (the “Banks”), to pay dividends to it; pending and future litigation; pending and future federal, state, local and foreign legislation, regulation, supervisory guidance and regulatory and legal actions including, but not limited to, those related to financial regulatory reform and consumer financial services practices, as well as any such actions with respect to late fees, interchange fees or other charges; increases in regulatory capital requirements or other support for the Banks; impacts arising from or relating to the transition of the Company’s credit card processing services to third party service providers that it completed in 2022; failures or breaches in operational or security systems, including as a result of cyberattacks, unanticipated impacts from technology modernization projects, failure of information security controls or otherwise; loss of consumer information or other data due to compromised physical or cyber security, including disruptive attacks from financially motivated bad actors and third party supply chain issues; any tax or other liability, or adverse impacts arising out of or related to the spinoff of the Company’s former LoyaltyOne segment or the bankruptcy filings of Loyalty Ventures Inc. (LVI) and certain of its subsidiaries, and subsequent litigation or other disputes. The foregoing factors, along with other risks and uncertainties that could cause actual results to differ materially from those expressed or implied in forward-looking statements, are described in greater detail under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10-K for the most recently ended fiscal year, which may be updated in Item 1A of, or elsewhere in, the Company’s Quarterly Reports on Form 10-Q filed for periods subsequent to such Form 10-K. The Company’s forward-looking statements speak only as of the date made, and it undertakes no obligation, other than as required by applicable law, to update or revise any forward-looking statements, whether as a result of new information, subsequent events, anticipated or unanticipated circumstances or otherwise.

Contacts

Investors/Analysts
Brian Vereb
Brian.Vereb@BreadFinancial.com

Susan Haugen
Susan.Haugen@BreadFinancial.com

Media
Rachel Stultz
Rachel.Stultz@BreadFinancial.com

FAQ

What did Bread Financial (BFH) announce on October 28, 2025 regarding debt?

Bread Financial priced a private offering of $500M 6.750% senior notes due 2031 and plans to use proceeds to redeem its 9.750% notes due 2029.

When will the Bread Financial (BFH) 6.750% notes close and how much net proceeds are expected?

Closing is expected on Nov 6, 2025 with approximately $493M in net proceeds after discounts and estimated offering expenses.

How will Bread Financial (BFH) fund the redemption of its 2029 notes and when is redemption scheduled?

The company will use the $493M net proceeds plus about $275M cash on hand to redeem all outstanding 2029 notes, with a conditional redemption date of Nov 7, 2025.

What are the terms and transfer restrictions of the new BFH notes?

The notes bear 6.750% interest, mature in 2031, are guaranteed by domestic subsidiaries, and were issued in a private placement exempt from registration.

What condition could prevent the BFH 2029 notes redemption from occurring?

The 2029 notes redemption is conditioned on the Notes offering generating at least $500M gross proceeds no later than 11:00 a.m. ET on Nov 7, 2025 and customary closing conditions.