In an all-stock deal that would merge the two of the largest credit card companies in the U.S., Capital One Financial is set to buy Discover Financial Services. The acquisition, which has not yet been finalized, could be announced as early as today.
Capital One—which currently issues credit cards affiliated with Visa and Mastercard—reportedly plans to keep the Discover brand, with its credit card network of around 305 million cardholders. The move would create the largest credit card firm by volume of loans and expand not only Capital One’s credit card offerings, but also its financial base.
“Discover has done a better job of bringing in a lot of deposits and [has] access to a lot of institutions to run the debit card network and provide service,” said David Schiff, West Monroe’s head of consumer retail and banking. “So it gives them a lot of deposit gathering ability, which particularly in the current market is enormously important.”
Capital One Financial also purchased the premium credit card and luxury market platform Velocity Black in June 2023. Shares of the company are up 4.6% in 2024 with a market cap of $52.2 billion, while Discover’s shares are down 1.7% for the year to a $27.63 billion market cap.
