“We continue to expect this reserve rate to increase a bit as we move through 2023, while also reflecting the continued premiumization of our portfolio.”

In context

“elinquency and write-off rates to increase over time, but they are likely to remain below pre-pandemic levels in 2023. Turning now to the accounting for this credit performance on Slide 10. The quarter-over-quarter growth in our loan balances was the primary driver of our $327 million of reserve build. Although, there was also a small component from incorporating a slightly worse macroeconomic outlook this quarter relative to last quarter. This reserve build, combined with net write-offs, drove $1.2 billion of provision expense in the second quarter. As you see on Slide 11, we ended the second quarter with $4.7 billion of reserves representing 2.6% of our total loans and Card Member receivables. This reserve remains about 30 basis points below the levels we had pre-pandemic or Day 1 CECL. We continue to expect this reserve rate to increase a bit as we move through 2023, while also reflecting the continued premiumization of our portfolio. Moving next to revenue on Slide 12. Total revenues were up 13% year-over-year in the second quarter on an FX-adjusted basis. Our largest revenue line, discount revenue grew 8% during (ph) Q2, as you can see on Slide 13, driven by the spending trends we discussed earlier. Net card fee revenues were up 22% year-over-year in the second quarter on an FX adjusted basis as you can see on Slide 14. Growth remains quite strong, and continues to be driven largely by bringing new accounts onto our fee paying products. This quarter, we acquired 3 million new cards and the spend, revenue and credit profiles of these acquisitions continue to look strong relative to what we saw pre pandemic. Importantly, the acquisition trends you see on Slide 14 in this and recent quarters are consistent with our long”