Bread Financial Provides Performance Update for May 2025
- Net loss rate improved to 8.0% from 8.8% year-over-year
- Delinquency rate decreased to 5.7% from 5.9% compared to previous year
- Company demonstrated social responsibility by freezing delinquencies for hurricane-affected cardholders
- 1% year-over-year decline in average credit card and other loans
- Net principal losses and loss rate expected to increase in Q2 2025 due to hurricane-related delinquency freezes
- End-of-period credit card loans decreased to $17.7 billion from $17.8 billion year-over-year
Insights
Bread Financial shows improving credit metrics with lower loss and delinquency rates despite slight loan portfolio contraction.
Bread Financial's May 2025 performance data reveals several encouraging credit quality trends. The company's net loss rate decreased to
In absolute terms, net principal losses fell to
It's worth noting that these improvements come with a caveat - the company's decision to freeze delinquency progression for cardholders in FEMA-identified hurricane impact zones temporarily suppressed loss rates in Q4 2024. Management explicitly warns this will negatively affect Q2 2025 metrics as those accounts flow through the collection cycle. This timing shift partially explains the current favorable performance, though the overall trend still suggests improving credit quality.
The combination of a modestly shrinking loan portfolio with improving loss and delinquency metrics suggests Bread Financial may be implementing more conservative underwriting standards, potentially sacrificing some growth for improved credit quality during uncertain economic conditions.
COLUMBUS, Ohio, June 11, 2025 (GLOBE NEWSWIRE) -- Bread Financial® Holdings, Inc. (NYSE: BFH), a tech-forward financial services company that provides simple, personalized payment, lending, and saving solutions to millions of U.S. consumers, provided a performance update. The following tables present the Company’s net loss rate and delinquency rate for the periods indicated:
| For the month ended May 31, 2025 | For the month ended May 31, 2024 | ||||||
| (dollars in millions) | |||||||
| End-of-period credit card and other loans | $ | 17,702 | $ | 17,847 | |||
| Average credit card and other loans | $ | 17,714 | $ | 17,846 | |||
| Year-over-year change in average credit card and other loans | (1 | %) | 1 | % | |||
| Net principal losses (1) | $ | 120 | $ | 133 | |||
| Net loss rate (1) | 8.0 | % | 8.8 | % | |||
| As of May 31, 2025 | As of May 31, 2024 | ||||||
| (dollars in millions) | |||||||
| 30 days + delinquencies – principal | $ | 926 | $ | 976 | |||
| Period ended credit card and other loans – principal | $ | 16,200 | $ | 16,446 | |||
| Delinquency rate | 5.7 | % | 5.9 | % | |||
______________________________________________________
| (1) | As a result of hurricanes Helene and Milton we froze delinquency progression for cardholders in Federal Emergency Management Agency identified impact zones for one billing cycle, which resulted in modestly lower Net principal losses and Net loss rate in the fourth quarter of 2024, and consequently these actions will negatively impact Net principal losses and Net loss rate in the second quarter of 2025. |
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. Our payment solutions, including Bread Financial general purpose credit cards and savings products, empower our customers and their passions for a better life. Additionally, we deliver growth for some of the most recognized brands in travel & entertainment, health & beauty, jewelry and specialty apparel through our private label and co-brand credit cards and pay-over-time products providing choice and value to our shared customers.
To learn more about Bread Financial, our global associates and our sustainability commitments, visit breadfinancial.com or follow us on Instagram and LinkedIn.
Forward-Looking Statements
This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements give our 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 our 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 we make regarding, and the guidance we give with respect to, our anticipated operating or financial results, future financial performance and outlook, future dividend declarations, and future economic conditions.
We believe that our 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 our control. Accordingly, our actual results could differ materially from the projections, anticipated results or other expectations expressed in this release, and no assurances can be given that our 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, including the level of future delinquency and write-off rates; the loss of, or reduction in demand from, significant brand partners or customers in the highly competitive markets in which we compete; the concentration of our business in U.S. consumer credit; inaccuracies in the models and estimates on which we rely, including the amount of our Allowance for credit losses and our credit risk management models; the inability to realize the intended benefits of acquisitions, dispositions and other strategic initiatives; our level of indebtedness and ability to access financial or capital markets; pending and future federal and state 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; impacts arising from or relating to the transition of our credit card processing services to third party service providers that we completed in 2022; failures or breaches in our operational or security systems, including as a result of cyberattacks, unanticipated impacts from technology modernization projects or otherwise; and any tax or other liability or adverse impacts arising out of or related to the spinoff of our 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 our Annual Report on Form 10-K for the most recently ended fiscal year, which may be updated in Item 1A of, or elsewhere in, our Quarterly Reports on Form 10-Q filed for periods subsequent to such Form 10-K. Our forward-looking statements speak only as of the date made, and we undertake 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
Brian Vereb — Investor Relations
Brian.Vereb@breadfinancial.com
Susan Haugen — Investor Relations
Susan.Haugen@breadfinancial.com
Rachel Stultz — Media
Rachel.Stultz@breadfinancial.com
FAQ
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