Discover Financial

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Discover Financial Services
Traded as
IndustryFinancial services
Founded1985; 35 years ago (1985) (as a subsidiary of Sears)
Key people
ProductsPayment systems
RevenueIncrease US$10.497 billion (2016)[1]
Increase US$3.6 billion (2016)[1]
Increase US$2.393 billion (2016)[1]
Total assetsIncrease US$92.308 billion (2016)[2]
Total equityIncrease US$11.323 billion (2016)[3]
Number of employees
15,549 (2017)[3]
SubsidiariesDiners Club International
Discover Bank
Discover Network

Discover Financial Services is an American financial services company that owns and operates Discover Bank, which offers checking and savings accounts, personal loans, home equity loans, student loans and credit cards. It also owns and operates the Discover and Pulse networks, and owns Diners Club International. Discover Card is the third largest credit card brand in the United States, when measured by cards in force, with nearly 50 million cardholders. Discover is currently headquartered in the Chicago suburb of Riverwoods, Illinois.[4]


Sears introduced the Discover credit card in 1985 in conjunction with real estate franchise Coldwell, Banker & Company and brokerage firm Dean Witter Reynolds. Altogether, these companies operated under the banner Sears Financial Network. In 1993, Sears sold off its financial services branch with Dean Witter Reynolds in charge of Discover. This independent company was called Dean Witter, Discover & Co. In 1997, Dean Witter, Discover & Co. merged with investment banking house Morgan Stanley to become Morgan Stanley Dean Witter, Discover & Co. In 1999, this company rebranded itself as Discover Financial Services, Inc.[5]

On December 21, 2001, fourth-quarter income at Discover grew 31% to $193 million, compared with $147 million the year before.[6]

On March 5, 2002, the company announced that the Account Center at had registered over eight million card members, an increase of 61% since January 2001.[7]

On September 1, 2002, Discover announced that Citibank would accept the Discover® Card for cash advances at its approximately 450 Financial Centers and more than 2,000 ATM locations nationwide.[8]

In April 2005, Morgan Stanley announced that it would divest Discover Financial Services as an independent company within six months. By June, industry sources reported that Morgan Stanley was reassessing its plan to spin off Discover. In August 2005, the company confirmed it would not sell Discover. However, in December 2006, Morgan Stanley announced it would spin off Discover as a standalone company by the end of August 2007, stating that both companies will be better positioned for growth and success as separate entities.[9] Ahead of schedule on June 30, 2007, Discover was spun off as an independent, publicly-traded company.[10]

Discover acquires The Greenwood Trust Company[edit]

The Greenwood Trust Company was founded in 1911 and was based in Greenwood, Delaware. It was acquired by Discover in 1985 and renamed Discover Bank in 2000.[11] Discover Bank is mainly an online financial institution that offers many financial services such as checking accounts, savings accounts, and money market accounts. However the first and original location of The Greenwood Trust Company on East Market Street is still operating and is the only physical banking location of Discover Bank.

Discover acquires Pulse[edit]

In 2005, Discover acquired Pulse, an interbank electronic funds transfer network. With this acquisition, Discover obtained the ability to market and issue debit and ATM cards. Starting in February 2006, Discover announced that it would begin offering Discover Debit, a debit product, to other financial institutions.

Discover acquires Diners Club International[edit]

In April 2008, Discover Financial and Citigroup announced that Discover was purchasing the Diners Club International network from Citigroup for $165 million. In May 2008, the Federal Trade Commission approved the transaction and it was finalized on July 1, 2008.[12] Discover stated that the Diners Club network, which is a major network outside the United States, will be merged with the Discover Network, a major network in the United States, creating an international network for Discover and Diners Club cardholders. Diners Club cards will continue to be issued by Diners Club International licensees. At this time, Discover Bank has no plans on issuing Diners Club branded cards itself.

On September 17, 2010, Discover Financial announced it would acquire Citigroup-owned Student Loan Corporation for $30/share.[13] The deal was finalized on December 31.[14]

Discover acquires Home Loan Center[edit]

On June 6, 2012,, Inc. completed the sale of substantially all of the operating assets of its Home Loan Center, Inc. business to a wholly owned subsidiary of Discover Financial. In exchange for the assets sold, Discover paid an aggregate of $45.9 million including payments made prior to the closing which were applied to the closing price.[15] On June 12, 2012, Discover began originating mortgages with its launch of Discover Home Loans, offering prime variable- and fixed-rate conventional and FHA home mortgage loans.

Discover and TARP[edit]

Following the 2007-08 financial crisis, Discover received about $1.2 billion in bailout funds under the Troubled Asset Relief Program (TARP). The company announced in 2010 that it had received approval to pay back the funds.[16]


In the United States, Discover, as a card brand, competes primarily with Visa, MasterCard, and American Express.[17] Unlike Visa and MasterCard, Discover directly issues its cards, through its Discover Bank unit.[18] When measured by card balances, Discover is the sixth largest credit card issuer in the U.S. behind JPMorgan Chase, Citigroup, Bank of America, Capital One and American Express, and ahead of Wells Fargo and U.S. Bank.[19]


In addition to its card products, Discover also markets savings products, checking accounts, personal loans, student loans, and home equity loans.


  1. ^ a b c "Annual Reports". Discover Financial. Retrieved February 28, 2018.
  2. ^ "The World's Biggest Public Companies: Discover Financial Services". Forbes. Retrieved February 28, 2018.
  3. ^ a b "Discover Financial Services 2011 Annual Report, Form 10-K, Filing Date Jan 26, 2012" (PDF). Retrieved June 30, 2012.
  4. ^ "Discover Financial Services - Company Profile and News". Bloomberg News. Retrieved July 2, 2020.
  5. ^ Kagan, Julia. [1]., June 27, 2018.
  6. ^ "Discover's Fourth Quarter Net Income Grows 31%".
  7. ^ "Discover Card Account Center Launches Online Sweepstakes; Click, Pay and Win With SmartCheck on" (Press release). Discover Financial. Archived from the original on March 31, 2012. Retrieved June 18, 2013.
  8. ^ "Discover Card Now Accepted for Cash Advances At Citibank; Discover Card Is Now Accepted At All U.S. Citibank Financial Centers and ATMs" (Press release). Discover Financial. Archived from the original on March 31, 2012. Retrieved June 18, 2013.
  9. ^ [2]. June 1, 2007.
  10. ^ “Discover flying solo”. The Green Sheet, July 9, 2007. Retrieved 2016-12-05.
  11. ^ "Greenwood Trust Company Renamed Discover Bank" (Press release). Discover Financial Services. August 1, 2000. Archived from the original on January 21, 2014.
  12. ^ Miller, James P. (July 1, 2008). "Discover completes purchase of Diners Club". Chicago Tribune. Archived from the original on July 6, 2008. Retrieved July 1, 2008.
  13. ^ "Discover Financial buying Citigroup's Student Loan Corp". Crain's Chicago Business. September 17, 2010. Retrieved December 19, 2014.
  14. ^ "Discover Completes Acquisition of the Student Loan Corporation" (Press release). Discover Financial Services. January 11, 2011. Retrieved December 19, 2014 – via Business Wire.
  15. ^ " Completes Sale of Certain Assets of Home Loan Center, Inc. to Discover" (Press release). June 7, 2012. Archived from the original on May 22, 2013. Retrieved July 14, 2012.
  16. ^ "Discover Lifts The TARP". Forbes. March 17, 2010. Retrieved February 28, 2018.
  17. ^ Holmes, Tamara P. "Credit card market share statistics"., June 22, 2016. Retrieved 2016-11-28.
  18. ^ Kiernan, John S. "List of Credit Card Companies & Networks: Differences, Contact Info & More". WalletHub, March 31, 2016. Retrieved 2016-11-28.
  19. ^ "Q1 2016: U.S. Credit Card Issuer Snapshot". Retrieved November 28, 2016.

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