Synchrony Financial, the country’s largest provider of store cards, abandoned its full-year guidance for metrics including loan growth and net charge-offs following the spending decline in the last two weeks of March,

(Bloomberg)—The company behind the credit cards for J.C. Penney Co., Gap Inc. and American Eagle Outfitters Inc. said that the nationwide shutdowns tied to the coronavirus pandemic have led to a sharp decline in spending on the firm’s cards.

Synchrony Financial, the country’s largest provider of store cards, abandoned its full-year guidance for metrics including loan growth and net charge-offs following the spending decline in the last two weeks of March, when retailers across the country were forced to shutter their stores as part of the efforts to slow the spread of the deadly virus.

“Our focus is clear and we have prioritized to deliver on the most critical initiatives to ensure success: We will protect our employees while continuing to deliver for our cardholders, retailers, merchants and providers,“ Synchrony CEO Margaret Keane said in a statement announcing first-quarter earnings.

Synchrony’s results showed how dramatically consumers pulled back over the course of the quarter. Purchases on the firm’s cards climbed 10% from a year earlier in January, 13% in February and 14% in the beginning of March. Then, between March 18 and 31, spending plummeted 26%.

Synchrony has said Gap (No. 23 in the 2020 Digital Commerce 360 Top 1000), J.C. Penney (No. 32), Lowe’s Cos. (No. 22), PayPal Holdings Inc. and Walmart Inc.’s Sam’s Club (No. 3) are its five biggest partners, with the group accounting for nearly half of the interest and fees it collects.

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The firm set aside $1.68 billion to cover souring loans in the first quarter, a 95% increase from a year earlier, in response to the economic impact of the coronavirus pandemic. Net income for the period dropped 74% to $286 million, or 45 cents a share.

123 retailers in Digital Commerce 360 Top 1000 have co-branded credit cards, which is 12.7%. (However, we do not have this data for  every merchant in the Top 1000.)

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