Capital One Cleared to Buy Discover Financial Services

In one of the biggest mergers in the last five years in the US Banking sector, Capital One Financial Corporation and Discover Financial Services has announced that the Federal Reserve System and the Office of the Comptroller of the Currency (OCC) have approved Capital One’s proposed acquisition of Discover.

This approval follows approval of the transaction by the Delaware State Bank Commissioner in December 2024, and by shareholders of more than 99% of each company’s shares voting in February of this year.

The OCC conducted a fulsome review of the application submitted 21 March 2024, to ensure all statutory and regulatory requirements have been met. The approval also followed consideration of numerous public comments submitted in writing and expressed during a public meeting held with the Board of Governors of the Federal Reserve System conducted on 19 July 2024.

Upon consummation of this transaction, Capital One, National Association is expected to have $660 billion in total assets. The deal is reportedly valued around $35.5 billion.

The decision to permit the merger of Capital One and Discover reflects OCC’s careful analysis of the effect of the merger on communities, the banking industry, and the US financial system, OCC said.

Exciting Moment

Capital one’s Founder and CEO Richard Fairbank said that this was an exciting moment for Capital One and Discover.

“We understand the critical importance of a strong and competitive banking system to our customers and our economy, and we appreciate the thoughtful and diligent engagement of our regulators as they thoroughly reviewed this deal over the past 14 months,” he said.

Thanking the thousands of associates across Capital One and Discover who have worked tirelessly to help Capital One achieve this significant milestone, he said that he was looking forward to bring these two great companies together with a profound sense of possibility and responsibility to deliver for their customers, associates, shareholders, and communities.

All required regulatory approvals to complete the transaction have now been received, and the transaction is expected to close on 18 May 2025, subject to the satisfaction of customary closing conditions.

Discover’s President and Interim CEO Michael Shepherd said that the combination of the two great companies will increase competition in payment networks, offer a wider range of products to their customers, increase resources devoted to innovation and security, and bring meaningful community benefits.

There will be no immediate changes to Capital One and Discover customer accounts and relationships now or in the period immediately following the closing of the transaction.

Capital One will provide customers with comprehensive information regarding relevant conversion activities well in advance of any future change. Until then, customers will continue to be served through their respective Capital One and Discover customer communications channels.

Upon closing, Capital One will begin implementation of its historic, five-year Community Benefits Plan (CBP), developed in connection with the acquisition and in partnership with leading community organisations, mobilizing more than $265 billion in lending, investment, and services to advance economic opportunity and financial well-being across America.