Discover Financial Has Weak Third-Quarter Pulse

RIVERWOODS, Ill. Discover Financial Services, spun off last quarter by Morgan Stanley, said third quarter earnings fell 16%, as the parent of Pulse EFT set aside provisions for loan losses and booked $5 million in costs related to the spin-off. The company also reported a pre-tax loss of $67 million for its international cards operations. Discover, spun off from Morgan Stanley on June 30, reported net income of $202 million, or 42 cents a share, for its fiscal third quarter, down from $241 million, for the same period last year. Discover, which has more than 50 million card holders, also operates the Pulse ATM and debit network and the U.K. card business Goldfish, which has been struggling through a tough credit environment in Britain. Since trading in its shares began July 2, the share price has declined more than 30%, from $29.15, to $20.25 yesterday.