Capital One receives final regulatory approvals for Discover acquisition

Capital One Financial Corporation and Discover Financial Services announced they have received final regulatory approvals from the Federal Reserve and the Office of the Comptroller of the Currency for Capital One’s acquisition of Discover. This follows earlier approvals from the Delaware State Bank Commissioner and shareholder votes in February, where over 99 percent of each company’s voting shares supported the deal.

The transaction is expected to close on May 18, 2025, pending customary closing conditions.

Capital One CEO Richard Fairbank emphasized the significance of the merger for the banking system and customer value, while Discover Interim CEO Michael Shepherd noted the merger's potential to increase competition, expand product offerings, and support innovation.

There will be no immediate changes to customer accounts or services post-closing. Capital One will inform customers in advance of any future changes.

Upon completion, Capital One will launch a five-year, $265 billion Community Benefits Plan focused on lending, investment, and financial services to promote economic opportunity nationwide.

Capital One and Discover stockholders have approved Capital One’s acquisition of Discover, marking a significant milestone in the process of combining the two financial institutions. At their respective special meetings, more than 99.8% of Capital One shareholders and over 99.3% of Discover shareholders voted in favor of the transaction, representing 85.1% and 81.6% of total outstanding shares, respectively.

The merger still requires regulatory approvals from the Federal Reserve Board and the Office of the Comptroller of the Currency, but it is expected to close in early 2025. Delaware’s State Bank Commissioner has already approved the deal.

The acquisition will bring together two companies with strong histories of serving consumers, small businesses, and merchants. Capital One, headquartered in McLean, Virginia, had $362.7 billion in deposits and $490.1 billion in total assets as of December 31, 2024. Discover, one of the largest card issuers in the U.S., operates a well-known digital banking and payments network.

Forward-looking statements in the announcement caution that the deal’s benefits, cost savings, and revenue synergies may not materialize as expected. Potential risks include regulatory scrutiny, integration challenges, and the impact on customers, employees, and business operations. However, the merger is seen as a strategic move that could reshape the financial services landscape.

Further details about the acquisition can be found at www.capitalonediscover.com.

Capital One Financial Corporation and Discover Financial Services announced that their stockholders have approved Capital One’s acquisition of Discover. At their respective Special Meetings, over 99.8% of Capital One shares and 99.3% of Discover shares voted in favor of the transaction, representing 85.1% and 81.6% of total outstanding shares as of December 27, 2024.

The approval marks a key milestone in the merger process, which is expected to be completed in early 2025, pending regulatory approvals from the Federal Reserve and the Office of the Comptroller of the Currency. The Delaware State Bank Commissioner had previously approved the acquisition on December 18, 2024.

Capital One, a Fortune 500 company, had $362.7 billion in deposits and $490.1 billion in total assets as of December 31, 2024. Discover, a major digital banking and payment services company, is known for its credit card business and payment networks. The merger aims to enhance financial services for consumers, businesses, and merchants. Further details are available at www.capitalonediscover.com.

Capital One Financial Corporation reported its credit charge-off and delinquency metrics for January 2025. Domestic credit card loans held for investment totaled $151.7 billion at period-end, with net charge-offs amounting to $774 million, reflecting a 6.12% charge-off rate. The 30+ day performing delinquency rate for domestic credit cards stood at 4.61%, with $6.99 billion in delinquent loans.

In consumer banking, auto loans held for investment reached $77 billion at period-end. Net charge-offs in this category were $125 million, resulting in a 1.95% charge-off rate. The 30+ day performing delinquency rate was 5.63%, representing $4.34 billion in delinquent auto loans. Nonperforming auto loans totaled $686 million, equating to a 0.89% nonperforming loan rate.

The reported metrics highlight trends in credit quality and loan performance, with net charge-offs and delinquency rates subject to fluctuations due to recoveries and debt sales.

Capital One Financial Corporation (NYSE: COF) announced the closing of a $1.75 billion public offering of 6.183% Fixed-to-Floating Rate Subordinated Notes due 2036 on January 30, 2025. The offering was conducted under an underwriting agreement dated January 28, 2025, with Goldman Sachs, J.P. Morgan, Morgan Stanley, Wells Fargo Securities, and Capital One Securities as representatives.

Capital One Financial Corporation released its monthly charge-off and delinquency metrics as of December 31, 2024, detailing performance in its credit card and consumer banking portfolios. The highlights are as follows:

Credit Card (Domestic):
- Average loans held for investment: $153.5 billion
- Net charge-offs: $803 million, with a net charge-off rate of 6.28%. Excluding the impact of the termination of the Walmart program agreement in May 2024, the net charge-off rate would have been 5.86%.
- 30+ day performing delinquencies: $7.1 billion, with a delinquency rate of 4.53%
- Nonperforming loans: Not applicable

Consumer Banking (Auto Loans):
- Average loans held for investment: $76.4 billion
- Net charge-offs: $162 million, with a net charge-off rate of 2.54%
- 30+ day performing delinquencies: $4.6 billion, with a delinquency rate of 5.95%
- Nonperforming loans: $750 million, with a nonperforming loan rate of 0.98%

The Walmart program agreement termination, effective May 21, 2024, contributed to a 42 basis-point increase in the net charge-off rate for Domestic Cards for December 2024. This provides additional context for analyzing the performance trends in Capital One's credit card portfolio.