This is a routine capital raise for a large financial institution. For SYF-PB holders, the new Series C preferred ranks equally with existing Series A and B preferreds, increasing the total preferred dividend burden but also adding equity cushion. Monitor the issuer's next quarterly earnings for any credit-relevant changes in leverage or FFO coverage of preferred dividends. The 7.250% fixed rate for five years provides a clear yield anchor for the new issue.
Price Chart
Executive Summary
Synchrony Financial is issuing 500,000 depositary shares (Series C Preferred Stock) at $1,000 per share, raising $500M in gross proceeds ($495M net before expenses). The net proceeds of ~$493.3M will be used for general corporate purposes. The preferred stock pays a 7.250% fixed dividend for the first five years, then resets to 5-Year U.S. Treasury Rate + 3.078% every five years thereafter. The offering is a routine capital raise to bolster Tier 1 capital and fund operations, with no immediate earnings or credit event for the preferred holders.
Key Facts
- Offering of 500,000 depositary shares at $1,000 per share, representing 5,000 shares of 7.250% Fixed Rate Reset Non-Cumulative Perpetual Preferred Stock, Series C.
- Total gross proceeds of $500,000,000; net proceeds to Synchrony of approximately $493.3 million after underwriting discount and estimated expenses.
- Dividend rate fixed at 7.250% per annum until August 15, 2031 (First Reset Date), then resets to Five-Year U.S. Treasury Rate plus 3.078% every five years.
- Dividends are non-cumulative and discretionary; no mandatory redemption; issuer may redeem on or after First Reset Date subject to Federal Reserve approval.
- Depositary shares will not be listed on any exchange; underwriters intend to make a market but are not obligated.
- Use of proceeds: general corporate purposes, including increasing liquidity, funding operations, and financing receivables.
Financial Impact
Synchrony raises $493.3 million in net proceeds from the sale of preferred equity, increasing Tier 1 capital by that amount. The annual dividend cost at the initial 7.250% rate is approximately $36.25 million per year on the $500M liquidation preference.
Risk Factors
- Dividends are discretionary and non-cumulative; the issuer may skip dividends without accrual obligation.
- No exchange listing may result in limited secondary market liquidity for the depositary shares.
- Future reset rate could be lower than 7.250% if Five-Year U.S. Treasury Rates decline significantly.
- Redemption is at issuer's option subject to Federal Reserve approval; holders cannot force redemption.
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 5 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 424B5 Filing (Primary) | 0001193125-26-255668 |
| Document: d44908dexfilingfees.htm | 0001193125-26-255668 |
| Document: 0001193125-26-255668-index-headers.html | 0001193125-26-255668 |
| Document: 0001193125-26-255668-index.html | 0001193125-26-255668 |
| Document: 0001193125-26-255668.txt | 0001193125-26-255668 |
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| Type | Now | ||||
|---|---|---|---|---|---|
Aug 17, 2026 6w ago | Press Release | $80.75 $76.06 | ▼ −5.81% | ▼ −3.83% | $71.79 (−11.10%) |
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Jul 21, 2026 10w ago | 8-K | $72.21 $80.58 | ▲ +11.59% | ▲ +9.03% | $71.79 (−0.58%) |
Jul 21, 2026 10w ago | Press Release | $72.21 $80.58 | ▲ +11.59% | ▲ +9.03% | $71.79 (−0.58%) |
Jun 29, 2026 13w ago | 8-K | $76.05 $75.31 | ▼ −0.97% | ▲ +0.06% | $71.79 (−5.60%) |
Jun 3, 2026 17w ago | 424B5 | $25.84 $25.91 | ▲ +0.27% | ▲ +1.64% | $71.79 (+177.83%) |
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