Discover Reports Second Quarter 2009 Results

Discover Financial Services has reported results for its second quarter ending May 31, 2009. According to Discover, US sales volume decreased 4% versus the second quarter of 2008, reflecting lower gas prices and a general decline in consumer spending. Managed loans ended the quarter at $51 billion, essentially unchanged from the prior quarter and up 7% from the prior year. The managed net charge-off rate increased to 7.79% for the second quarter of 2009, up 131 basis points and 280 basis points from the prior quarter and the prior year, respectively. The managed net charge-off rate for the third quarter of 2009 is expected to be between 8.5% and 9%.

“While the rise in unemployment continued to have a significant impact on our financial results, I am pleased with our strong relative performance in both credit management and sales volumes,” said David Nelms, chairman and chief executive officer of Discover Financial Services. “We continue to focus on reducing expenses and maintaining a strong capital position as we manage through these challenging times.”