Master Trust and More: QTD results pointing to improving NCO trends while loan growth a touch softer

August credit metrics showed relatively stable DQ trends, NCOs that outperformed expectations (and saw an improvement in the YoY decline), and loan growth modestly ahead of expectations. Together, this implies issuers should outperform NCO expectations into 3Q while loan growth is likely to come in a touch softer. Card 30D+ DQs came in lower than expected (+3bps MoM at 3.57%; expectations of 3.63%), while NCOs were down -12bps MoM to 4.33%, outperforming LT expectations of -6bp. Loan growth was decent as EOP loan growth improved on a YoY basis, up ~+4.2% YoY with the pace of change improving from July (+3.9% YoY) while MoM loan growth of +0.7% was stronger than seasonality (+0.2%). Overall, QTD trends point to lower NCOs and lower loan balances vs. expectations in 3Q, while auto metrics appear to be tracking modestly lower than expected at COF and, while the math implied losses of 1.85% for ALLY, we think its reiterated commentary around reaching the mid-point of its FY26 guidance rang