Julia Coronado, founder and president of MacroPolicy Perspectives, talks on Making Money about whether a new local banking crisis is on the horizon.
Warren Buffett-backed consumer bank and credit card issuer Capital One is acquiring credit card lender Discover Financial Services, The Wall Street Journal reported, citing people familiar with the matter. The company plans to acquire the company.
Capital One is working with advisers on a “transaction review” to acquire Discover, and a deal could be announced as early as Tuesday, the magazine reported. Bloomberg reported early Monday that Capital One was considering an offer for Discover.
Discover’s market value is about $28 billion, and an acquisition is expected to fetch a premium above that valuation, the Journal reported.
Discover and Capital One posted fourth-quarter profits of 62% and 62%, respectively, in January as rising interest rates increased the risk of consumers defaulting on their credit card debts and mortgages, and banks increased provisions for losses on bad loans. It reported a 43% decrease.
Capital One is reportedly considering acquiring Discover. (Capital One: Craig Warga/Bloomberg via Getty Images | Discover: Tiffany Hagler-Geard/Bloomberg via Getty Images / Getty Images)
This is a developing story. Please check back for the latest information.
Reuters contributed to this report.
