Bread Financial Holdings, Inc.

Business model

• Tech-forward financial services company offering payment, lending, and saving solutions to millions of U.S. consumers.
• Primary activities:
  • Co-brand and private-label credit card programs with retailers and brand partners (issued and serviced by Bread’s banks).
  • Direct-to-consumer (DTC) general purpose credit cards (Bread Cashback AmEx and Bread Rewards AmEx).
  • Bread Pay products: installment loans and four-installment, interest-free “split-pay” offerings for merchants and partners, including integrations with third-party platforms.
  • Bread Savings deposits: retail deposits, including certificates of deposit and high-yield savings accounts, and traditional and Roth IRAs.
• Revenue model:
  • Primarily interest and fees on loans across credit card and other loan products.
  • Additional revenue from partner arrangements (merchant discount fees, royalties, retailer shares) and from rewards programs (costs are recognized as reductions of revenue).

Core product offerings

• Co-brand and private-label credit cards on American Express, MasterCard, and Visa networks.
• Bread Cashback American Express Card and Bread Rewards American Express Card (DTC products).
• Bread Pay: fixed-term installment loans (typically 3–84 months) and four-installment, interest-free split-pay options.
• Bread Savings: retail deposit products, including CDs, high-yield savings, and IRAs.

Market and partners

• Brand partner base of nearly 100 brands and numerous online merchants across travel/entertainment, apparel, health/beauty, jewelry, sporting goods, technology, and home/furniture.
• Examples of partners: AAA, Academy Sports + Outdoors, Caesars, Dell Technologies, Hard Rock International, the NFL, Raymour & Flanigan, Saks Fifth Avenue, Signet, Ulta, Victoria’s Secret.
• Concentration: the five largest credit card programs accounted for about 49% of total net interest and non-interest income (excluding gain on sale); large programs include Signet Jewelers, Ulta Beauty, and Victoria’s Secret & Co.

Scale and customers

• Approximately 34 million open and outstanding credit card and other loan accounts as of December 31, 2025.
• Average outstanding DTC credit card balance: about $2,295 for the year ended December 31, 2025.

Financial scale and funding

• Credit card and other loans outstanding: $18.8 billion as of December 31, 2025; average balance per account with outstanding balances: $1,047.
• Deposits and funding:
  • Total deposits: $13.9 billion as of December 31, 2025.
  • Deposit mix: non-maturity savings deposits ≈ $7.7 billion; certificates of deposit ≈ $6.2 billion.
  • Uninsured deposits ≈ $638 million (about 5% of total deposits).
  • Bread Savings deposits grew to about $8.5 billion by December 31, 2025 (up 11% from $7.7 billion at year-end 2024) and represented about 48% of total funding sources, with the remainder from wholesale deposits and borrowings.
• Securitization and debt:
  • Securitization of credit card loans is a material funding source (trusts issuing notes collateralized by loans).
  • Outstanding debt includes senior and subordinated notes (examples referenced in liquidity discussion: $500 million of 6.750% senior notes due 2035 and $400 million of 8.375% subordinated notes due 2035).

Bank structure and regulation

• Two banks supporting programs: Comenity Bank (Delaware-chartered credit card bank) and Comenity Capital Bank (Utah-chartered industrial bank).
• Planned merger: Comenity Bank into Comenity Capital Bank (surviving entity), expected to close in the second half of 2026.

Geography and operations

• Primary operations in the United States.
• Core credit card processing with Fiserv since 2022, supporting faster product rollout and ongoing compliance support.

Technology and risk

• Emphasizes digital and mobile capabilities: API integrations, digital wallet provisioning, and an enhanced Bread Financial mobile app.
• Ongoing focus on underwriting, fraud prevention, data analytics, and marketing analytics, including AI-driven capabilities.
• Operates a three-lines-of-defense risk management model with board-level governance and a dedicated risk officer.

Summary

Bread Financial is a single-segment financial services company focused on using technology to provide end-to-end payment, lending, and saving solutions through partner and direct-to-consumer programs. As of December 31, 2025, the company supported roughly 34 million accounts, employed about 6,000 people, held $18.8 billion in loan balances, and had $13.9 billion in deposits, with retail deposits representing a substantial portion of funding.