Discover Financial Reports Higher Fourth Quarter Earnings

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RIVERWOODS, Ill. – Discover Financial Services Co. said higher transaction volume on its credit cards contributed to a 5% growth in fourth quarter net income, to $346.5 million.

Discover card sales volume was $23 billion in the quarter, an increase of 6% from last year.

Net charge-offs fell to 6.58% of balances, for the company’s fiscal fourth quarter from 7.98% last year. The percentage of payments that were late by 30 days or more, considered an indicator of future default, dropped to 3.89% from 4.92% in the 2009 quarter.

For the full fiscal year, Discover posted net income of $667.9 million, down from $1.21 billion, last year, which included a gain of $1.2 billion after tax related to an antitrust settlement with Visa and MasterCard.

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