Capital One to buy Discover, reports say

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Banking giant Capital One is closing in on a purchase of Discover Financial Services, a deal that would bring together two of the country’s largest credit card companies, according to media reports.

The all-stock transaction could be announced as soon as Tuesday, Bloomberg News reported on Monday, citing people familiar with the matter. Capital One and Discover did not immediately respond to emails seeking comment.

The two financial giants, if combined, would become the biggest credit card lender in the nation, according to data compiled by Bloomberg Intelligence. Discover, based in Riverwoods, Ill., has a market value of nearly $28 billion, while McLean, Va.-based Capital One is valued at about $52 billion.

Credit card usage has soared in recent months, as Americans are depleting their extra savings and recalibrating spending to keep up with recent inflation. Overall credit card balances hit a record $1.13 trillion in 2023, according to the Federal Reserve Bank of New York.

The deal could face antitrust scrutiny from regulators, who are already engaged in an overhaul of bank capital rules that have faced stiff industry opposition. If the transaction closes, it would be one of the largest since the 2008 financial crisis.

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