Discover Financial Services

The credit card issuer has hired John T. Greene, a former pharmaceutical industry executive, to succeed Mark Graf, who announced his retirement over the summer.

The CEOs of Sallie Mae and Discover Financial Services were largely dismissive this week of the threat posed by the two Democratic presidential candidates, though their optimism seemed to be rooted in an assumption that the more sweeping proposals will never become law.

While loan growth continues to outpace competitors, Discover says it has been tightening its standards, given the late stage of the credit cycle.

The move figures to generate more low-cost funding for the firm’s consumer lending businesses without sacrificing substantial revenue.

Some of the biggest industry moves in May and early June were not executive promotions, but rather departures.

The large credit card issuers are becoming more selective about who they are extending credit to and how much they are willing to lend, their CEOs said Tuesday.

Mark Graf, who joined the Riverwoods, Ill.-based credit card issuer in 2011, will participate in the search for his successor.

Thirty-day delinquency rates, a harbinger of future write-offs, also increased at all seven of the largest U.S. card issuers in the first quarter.

The company's credit card business has been outpacing industrywide loan growth. In the first quarter, results were also aided by higher loan yields.

Though banks are generating more revenue from interchange and annual fees, those gains have been offset by declines in income from cash advances and late fees.

At banks of all sizes — from the $7.2 billion-asset WSFS Financial to the $373 billion-asset Capital One — marketing budgets ballooned in the fourth quarter.

Discover leaned heavily on rewards to drive new card acquisitions and sales growth in the fourth quarter, but suffered a double whammy of rising reward costs and higher charge-offs, causing it to miss analyst earnings expectations.

Delinquencies, which are on the rise across financial services, clouded an otherwise solid quarter for Discover Financial Services.

Lawrence Weinbach will replace David Nelms, who had already stepped down as CEO. The transition will take place Jan. 1.

Personal loans are "tricky to underwrite" because consumer credit scores are high at the time of origination and then drift downward, says Roger Hochschild, who recently took over as the head of Discover Financial Services.

Double-digit gains in card volume offset an uptick in problem loans.

Offereins led to Discover's payments business to another year of strong growth while setting in motion a bold plan to disrupt the point-of-sale experience.

Four lenders, led by Sallie Mae, have long dominated the market for private student loans. But they could soon face new competition from Navient and Nelnet.

Digital banks dispute the notion that they can skimp on customer service because millennials are only shopping for low fees and high savings rates.

A smaller tax bill and a double-digit growth in card loans offset weakening credit quality at the Riverwoods, Ill., company.