# EDGAR Filing Document

**Accession Number:** 0001393612
**File Stem:** 0001393612-23-000002
**Filing Date:** 2023-1
**Character Count:** 97567
**Document Hash:** 6662fd4fce2eed98ad4153be6a2db352
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001393612-23-000002.hdr.sgml**: 20230118

**ACCESSION NUMBER**: 0001393612-23-000002

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 32

**CONFORMED PERIOD OF REPORT**: 20230118

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230118

**DATE AS OF CHANGE**: 20230118

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Discover Financial Services
- **CENTRAL INDEX KEY:** 0001393612
- **STANDARD INDUSTRIAL CLASSIFICATION:** PERSONAL CREDIT INSTITUTIONS [6141]
- **IRS NUMBER:** 362517428
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-33378
- **FILM NUMBER:** 23534598

**BUSINESS ADDRESS:**
- **STREET 1:** 2500 LAKE COOK ROAD
- **CITY:** RIVERWOODS
- **STATE:** IL
- **ZIP:** 60015
- **BUSINESS PHONE:** 224-405-0900

**MAIL ADDRESS:**
- **STREET 1:** 2500 LAKE COOK ROAD
- **CITY:** RIVERWOODS
- **STATE:** IL
- **ZIP:** 60015

?xml version="1.0" ? dfs-20230118

**UNITED STATES** 

**SECURITIES AND EXCHANGE COMMISSION** 

**Washington, D.C. 20549** 

**Form 8-K** 

**Current Report** 

**Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934** 

**Date of Report (Date of earliest event reported): January 18, 2023**

**DISCOVER FINANCIAL SERVICES** 

**(Exact name of registrant as specified in its charter)** 

**Commission File Number: 001-33378** 

---

| | |
|:---|:---|
| **Delaware** | **36-2517428** |
| **(State or other jurisdiction<br>of incorporation)** | **(IRS Employer <br>Identification No.)** |

---

**2500 Lake Cook Road, Riverwoods, Illinois 60015** 

**(Address of principal executive offices, including zip code)** 

**(224) 405-0900** 

**(Registrant's telephone number, including area code)** 

**N/A**

**(Former name or former address, if changed since last report)** 

**Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:** 

**☐** **Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)**

**☐** **Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)**

**☐** **Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))**

**☐** **Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))**

---

| | | |
|:---|:---|:---|
| **Securities registered pursuant to Section 12(b) of the Act** | **Securities registered pursuant to Section 12(b) of the Act** | **Securities registered pursuant to Section 12(b) of the Act** |
| **<u>Title of each class</u>** | **<u>Trading symbol(s)</u>** | **<u>Name of each exchange on which registered</u>** |
| Common Stock, par value $0.01 per share | DFS | New York Stock Exchange |

---

**Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).**

**Emerging growth company ☐** 

**If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐** 

------

**Item 2.02.** &nbsp;&nbsp;&nbsp;&nbsp;**Results of Operations and Financial Condition.**

On January 18, 2023, Discover Financial Services (the "Company") released financial information with respect to the quarter ended December 31, 2022. Copies of the press release, financial data supplement and financial results presentation containing this information are attached hereto as exhibits and incorporated herein by reference.

The information contained in this Item 2.02 of this Current Report on Form 8-K, including the exhibits, is furnished pursuant to Item 2.02 of Form 8-K and shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except as shall be expressly stated by specific reference in such filing.

------

**Item 9.01.** &nbsp;&nbsp;&nbsp;&nbsp;**Financial Statements and Exhibits.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(d) Exhibits** 

---

| | |
|:---|:---|
| **Exhibit No.** | **Description** |
| <u>[99.1](dfs-earningsreleasex4q22ex.htm)</u> | Press Release of the Company dated January 18, 2023 containing financial information for the quarter ended December 31, 2022 |
| <u>[99.2](dfs20221231ex992.htm)</u> | Financial Data Supplement of the Company for the quarter and the Twelve Months Ended December 31, 2022 |
| <u>[99.3](a4q22earningspresentatio.htm)</u> | Financial Results Presentation of the Company for the quarter ended December 31, 2022 |
| 104 | Cover Page Interactive Data File — the cover page from this Current Report on Form 8-K, formatted as Inline XBRL (included as Exhibit 101) |

---

------

**SIGNATURES** 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

---

| | | |
|:---|:---|:---|
| | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** |
| Dated: January 18, 2023 | By: | <u>/s/ Philip J. Castrogiovanni</u> |
|  |  | Name: Philip J. Castrogiovanni  |
|  |  | Title: Vice President, Secretary and Deputy General Counsel |

---

## Exhibit 99.1

**&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp; **Exhibit 99.1**&nbsp;&nbsp;&nbsp;&nbsp;

![discoverlogo20150630a20.jpg](discoverlogo20150630a20.jpg)

**DISCOVER FINANCIAL SERVICES REPORTS FOURTH QUARTER 2022 NET INCOME OF $1.0 BILLION OR $3.77** 

**PER DILUTED SHARE AND FULL YEAR NET INCOME OF $4.4 BILLION OR $15.50 PER DILUTED SHARE**

**BOARD OF DIRECTORS DECLARES SEMI-ANNUAL DIVIDEND FOR PREFERRED STOCK AND QUARTERLY DIVIDEND FOR COMMON STOCK**

---

| | | | |
|:---|:---|:---|:---|
| **Fourth Quarter 2022 Results** | **Fourth Quarter 2022 Results** | **Fourth Quarter 2022 Results** | **Fourth Quarter 2022 Results** |
|  | 2022 | 2021 | YOY Change |
| Total loans, end of period (in billions) | $112.1 | $93.7 | 20% |
| Total revenue net of interest expense (in millions) | $3732 | $2936 | 27% |
| Total net charge-off rate | 2.13% | 1.37% | 76 bps |
| Net income/(loss) (in millions) | $1033 | $1067 | (3)% |
| Diluted EPS | $3.77 | $3.64 | 4% |

---

**Riverwoods, IL, January 18, 2023** - Discover Financial Services (NYSE: DFS) today reported net income of $1.0 billion or $3.77 per diluted share for the fourth quarter of 2022, as compared to a net income of $1.1 billion or $3.64 per diluted share for the fourth quarter of 2021.

"Our outstanding results in 2022 were driven by record loan growth and margin expansion, factors that should sustain strong revenue growth into next year," said Roger Hochschild, CEO and President of Discover. "This revenue momentum, our disciplined approach to credit management, and our capital generative model position us to generate shareholder value through a range of economic environments."

**Segment Results**

**Digital Banking**

Digital Banking pretax income of $1.3 billion for the quarter was $141 million lower than the prior year period reflecting a higher provision for credit losses and higher operating expenses, mostly offset by increased revenue net of interest expense.

Total loans ended the quarter at $112.1 billion, up 20% year-over-year, and up 7% sequentially. Credit card loans ended the quarter at $90.1 billion, up 21% year-over-year. Personal loans increased $1.1 billion, or 15%, and private student loans increased $195 million, or 2%, year-over-year. The organic student loan portfolio, which excludes purchased loans, increased $351 million, or 4% from the prior year period.

Net interest income for the quarter increased $584 million, or 24% driven by higher average receivables and net interest margin expansion. Net interest margin was 11.27%, up 46 basis points versus the prior year. Card yield was 14.50%, up 200 basis points from the prior year primarily driven by higher market rates partially offset by a higher mix of receivables at a promotional rate and slightly higher interest charge-offs. Interest expense as a percent of total loans increased 177 basis points from the prior year period, primarily driven by higher funding costs.

Non-interest income increased $81 million, or 16%, from the prior year period, mainly driven by higher discount/interchange revenue and loan fee income partially offset by higher rewards cost driven by higher sales volumes.

The total net charge-off rate of 2.13% was 76 basis points higher versus the prior year period reflecting credit normalization across the portfolio. The credit card net charge-off rate was 2.37%, up 87 basis points from the prior year period and up 45 basis points from the prior quarter. The 30+ day delinquency rate for credit card loans was 2.53%, up 87 basis points year-over year and up 42 basis point from the prior quarter. The student loan net charge-off rate was 1.33%, up 53 basis points from the prior year and up 42 basis points from the prior quarter. Personal loans net charge-off rate of 1.49% was up 28 basis points from the prior year and up 35 basis points from the prior quarter.

------

![discoverlogo20150630a20.jpg](discoverlogo20150630a20.jpg)

Provision for credit losses of $883 million increased $620 million from the prior year driven by a $313 million reserve build in the current quarter compared to a $39 million reserve release in the prior year quarter and a $268 million increase in net-charge offs.

Total operating expenses were up $186 million year-over year, or 15%, driven primarily by higher expenses for employee compensation, marketing, professional fees, and premises and equipment. The increase in employee compensation was driven by higher headcount. Marketing increased primarily due to investments in consumer banking, card brand, and acquisition. Professional Fees increased due to investment in technology and consulting costs. Premises and equipment was higher due to a one-time facility write-off.

**Payment Services**

Payment Services pretax income of $37 million was up $134 million year-over-year. Higher revenue was driven by $138 million net losses on equity investments in the prior year quarter compared to $6 million net losses in the current year quarter.

Payment Services volume was $86.4 billion, up 4% year-over-year. PULSE dollar volume was up 3% primarily driven by increased debit transaction volume. Diners Club volume was up 24% year-over-year reflecting an improvement in global T&E and corporate spending. Network Partners volume decreased 7% from the prior year primarily reflecting lower transaction volume.

**Share Repurchase**

During the fourth quarter of 2022, the company repurchased approximately 5.9 million shares of common stock for $602 million. Shares of common stock outstanding declined by 2.1% from the prior quarter.

**Dividend Declaration**

The Board of Directors of Discover Financial Services declared a semi-annual cash dividend on its Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series C, in the amount of $2,750 per share. The dividend equals $27.50 per depositary share, each representing 1/100th interest in a share of the Series C Preferred Stock. The dividend will be payable on May 1, 2023, to the holders of record at the close of business on April 14, 2023.

The Board of Directors of Discover Financial Services declared a semi-annual cash dividend on its Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series D, in the amount of $3,062.50 per share. The dividend equals $30.625 per depositary share, each representing 1/100th interest in a share of the Series D Preferred Stock. The dividend will be payable on March 23, 2023, to the holders of record at the close of business on March 8, 2023.

The Board of Directors declared a quarterly cash dividend of $0.60 per share of common stock payable on March 9, 2023, to holders of record at the close of business on February 23, 2023.

**Conference Call and Webcast Information**

The company will host a conference call to discuss its fourth quarter results on Thursday, January 19, 2023, at 7:00 a.m. Central Time. Interested parties can listen to the conference call via a live audio webcast at https://investorrelations.discover.com.

**About Discover**

Discover Financial Services (NYSE: DFS) is a digital banking and payment services company with one of the most recognized brands in U.S. financial services. Since its inception in 1986, the company has become one of the largest card issuers in the United States. The company issues the Discover® card, America's cash rewards pioneer, and offers private student loans, personal loans, home loans, checking and savings accounts and certificates of deposit through its banking business. It operates the Discover Global Network® comprised of Discover Network, with millions of merchants and cash access locations; PULSE®, one of the nation's leading ATM/debit networks; and Diners Club International®, a global payments network with acceptance around the world. For more information, visit www.discover.com/company.

**Contacts**

**Investors:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Media:**

Eric Wasserstrom, 224-405-4555&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Matthew Towson, 224-405-5649

investorrelations@discover.com&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;matthewtowson@discover.com

------

![discoverlogo20150630a20.jpg](discoverlogo20150630a20.jpg)

A financial summary follows. Financial, statistical, and business related information, as well as information regarding business and segment trends, is included in the financial supplement filed as Exhibit 99.2 to the company's Current Report on Form 8-K filed today with the Securities and Exchange Commission ("SEC"). Both the earnings release and the financial supplement are available online at the SEC's website (http://www.sec.gov) and the company's website (https://investorrelations.discover.com).

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements, which speak to our expected business and financial performance, among other matters, contain words such as "believe," "expect," "anticipate," "intend," "plan," "aim," "will," "may," "should," "could," "would," "likely," and similar expressions. Such statements are based upon the current beliefs and expectations of the company's management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements. These forward-looking statements speak only as of the date of this press release, and there is no undertaking to update or revise them as more information becomes available.

The following factors, among others, could cause actual results to differ materially from those set forth in the forward-looking statements: the effect of the coronavirus disease 2019 pandemic and measures taken to mitigate the pandemic, including their impact on our credit quality and business operations as well as their impact on general economic and financial markets; changes in economic variables, such as the availability of consumer credit, the housing market, energy costs, the number and size of personal bankruptcy filings, the rate of unemployment, the levels of consumer confidence and consumer debt, and investor sentiment; the impact of current, pending and future legislation, regulation, supervisory guidance, and regulatory and legal actions, including, but not limited to, those related to accounting guidance, tax reform, financial regulatory reform, consumer financial services practices, anti-corruption and funding, capital and liquidity; the actions and initiatives of current and potential competitors; the company's ability to manage its expenses; the company's ability to successfully achieve card acceptance across its networks and maintain relationships with network participants and merchants; the company's ability to sustain its card, private student loan and personal loan growth; the company's ability to increase or sustain Discover card usage or attract new customers; difficulty obtaining regulatory approval for, financing, closing, transitioning, integrating or managing the expenses of acquisitions of or investments in new businesses, products or technologies; the company's ability to manage its credit risk, market risk, liquidity risk, operational risk, compliance and legal risk, and strategic risk; the availability and cost of funding and capital; access to deposit, securitization, equity, debt and credit markets; the impact of rating agency actions; the level and volatility of equity prices, commodity prices and interest rates, currency values, investments, other market fluctuations and other market indices; losses in the company's investment portfolio; limits on the company's ability to pay dividends and repurchase its common stock; limits on the company's ability to receive payments from its subsidiaries; fraudulent activities or material security breaches of its or others' key systems; the company's ability to remain organizationally effective; the effect of political, economic and market conditions, geopolitical events, climate change and unforeseen or catastrophic events; the company's ability to introduce new products or services; the company's ability to manage its relationships with third-party vendors, as well as those which we have no direct relationship such as our employees' internet service providers; the company's ability to maintain current technology and integrate new and acquired systems and technology; the company's ability to collect amounts for disputed transactions from merchants and merchant acquirers; the company's ability to attract and retain employees; the company's ability to protect its reputation and its intellectual property; the company's ability to comply with regulatory requirements; and new lawsuits, investigations or similar matters or unanticipated developments related to current matters. The company routinely evaluates and may pursue acquisitions of or investments in businesses, products, technologies, loan portfolios or deposits, which may involve payment in cash or the company's debt or equity securities.

Additional factors that could cause the company's results to differ materially from those described in the forward-looking statements can be found under "Risk Factors," "Business - Competition," "Business - Supervision and Regulation" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the company's Annual Report on Form 10-K for the year ended December 31, 2021, "Risk Factors" and "Management's Discussion & Analysis of Financial

Condition and Results of Operations" in the company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2022, June 30, 2022 and March 31, 2022 which is filed with the SEC and available at the SEC's internet site (http://www.sec.gov) and subsequent reports on Forms 8-K and 10-Q, including the company's Current Report on Form 8-K filed today with the SEC.

## Exhibit 99.2

---

| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **DISCOVER FINANCIAL SERVICES** | | | | | | | | | | **Exhibit 99.2** | **Exhibit 99.2** |
| **EARNINGS SUMMARY** | **EARNINGS SUMMARY** | **EARNINGS SUMMARY** | **EARNINGS SUMMARY** | **EARNINGS SUMMARY** | **EARNINGS SUMMARY** | **EARNINGS SUMMARY** | **EARNINGS SUMMARY** | | | | |
| **(unaudited, in millions, except per share statistics)** | **(unaudited, in millions, except per share statistics)** | **(unaudited, in millions, except per share statistics)** | **(unaudited, in millions, except per share statistics)** | **(unaudited, in millions, except per share statistics)** | **(unaudited, in millions, except per share statistics)** | **(unaudited, in millions, except per share statistics)** | **(unaudited, in millions, except per share statistics)** | | | | |
| | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | | | **Twelve Months Ended** | **Twelve Months Ended** | | |
| | **Dec 31,<br>2022** | **Sep 30,<br>2022** | **Jun 30,<br>2022** | **Mar 31,<br>2022** | **Dec 31,<br>2021** | **Dec 31, 2022 vs. Dec 31, 2021** | **Dec 31, 2022 vs. Dec 31, 2021** | **Dec 31,<br>2022** | **Dec 31,<br>2021** | **2022 vs. 2021** | **2022 vs. 2021** |
| **<u>EARNINGS SUMMARY</u>** | | | | | | | | | | | |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest Income | $3856 | $3357 | $2915 | $2736 | $2742 | $1114 | 41% | $12864 | $10651 | $2213 | 21% |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest Expense | 789 | 514 | 305 | 257 | 259 | 530 | NM | 1865 | 1134 | 731 | 64% |
| Net Interest Income | 3067 | 2843 | 2610 | 2479 | 2483 | 584 | 24% | 10999 | 9517 | 1482 | 16% |
| &nbsp;&nbsp;&nbsp;&nbsp;Discount/Interchange Revenue | 1165 | 1157 | 1133 | 955 | 1042 | 123 | 12% | 4410 | 3733 | 677 | 18% |
| &nbsp;&nbsp;&nbsp;&nbsp;Rewards Cost | 797 | 811 | 743 | 635 | 697 | 100 | 14% | 2986 | 2509 | 477 | 19% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Discount and Interchange Revenue, net | 368 | 346 | 390 | 320 | 345 | 23 | 7% | 1424 | 1224 | 200 | 16% |
| &nbsp;&nbsp;&nbsp;&nbsp;Protection Products Revenue | 44 | 42 | 42 | 44 | 36 | 8 | 22% | 172 | 165 | 7 | 4% |
| &nbsp;&nbsp;&nbsp;&nbsp;Loan Fee Income | 182 | 168 | 142 | 140 | 131 | 51 | 39% | 632 | 464 | 168 | 36% |
| &nbsp;&nbsp;&nbsp;&nbsp;Transaction Processing Revenue | 66 | 65 | 61 | 57 | 60 | 6 | 10% | 249 | 227 | 22 | 10% |
| &nbsp;&nbsp;&nbsp;&nbsp;Gains (Losses) on Equity Investments | (6) | (4) | (42) | (162) | (138) | 132 | 96% | (214) | 424 | (638) | NM |
| &nbsp;&nbsp;&nbsp;&nbsp;Other Income | 11 | 19 | 21 | 24 | 19 | (8) | (42%) | 75 | 66 | 9 | 14% |
| Total Non-Interest Income | 665 | 636 | 614 | 423 | 453 | 212 | 47% | 2338 | 2570 | (232) | (9%) |
| Revenue Net of Interest Expense | 3732 | 3479 | 3224 | 2902 | 2936 | 796 | 27% | 13337 | 12087 | 1250 | 10% |
| Provision for Credit Losses | 883 | 773 | 549 | 154 | 263 | 620 | NM | 2359 | 218 | 2141 | NM |
| &nbsp;&nbsp;&nbsp;&nbsp;Employee Compensation and Benefits | 573 | 551 | 515 | 500 | 499 | 74 | 15% | 2139 | 1986 | 153 | 8% |
| &nbsp;&nbsp;&nbsp;&nbsp;Marketing and Business Development | 313 | 276 | 254 | 192 | 271 | 42 | 15% | 1035 | 810 | 225 | 28% |
| &nbsp;&nbsp;&nbsp;&nbsp;Information Processing & Communications | 143 | 124 | 121 | 125 | 125 | 18 | 14% | 513 | 500 | 13 | 3% |
| &nbsp;&nbsp;&nbsp;&nbsp;Professional Fees | 264 | 241 | 189 | 177 | 230 | 34 | 15% | 871 | 797 | 74 | 9% |
| &nbsp;&nbsp;&nbsp;&nbsp;Premises and Equipment | 48 | 22 | 24 | 24 | 23 | 25 | 109% | 118 | 92 | 26 | 28% |
| &nbsp;&nbsp;&nbsp;&nbsp;Other Expense | 154 | 174 | 120 | 112 | 164 | (10) | (6%) | 560 | 620 | (60) | (10%) |
| Total Operating Expense | 1495 | 1388 | 1223 | 1130 | 1312 | 183 | 14% | 5236 | 4805 | 431 | 9% |
| Income/ (Loss) Before Income Taxes | 1354 | 1318 | 1452 | 1618 | 1361 | (7) | (1%) | 5742 | 7064 | (1322) | (19%) |
| Tax Expense | 321 | 312 | 341 | 376 | 294 | 27 | 9% | 1350 | 1615 | (265) | (16%) |
| Net Income/ (Loss) | $1033 | $1006 | $1111 | $1242 | $1067 | ($34) | (3%) | $4392 | $5449 | ($1057) | (19%) |
| Net Income/ (Loss) Allocated to Common Stockholders | $1027 | $967 | $1105 | $1205 | $1062 | ($35) | (3%) | $4304 | $5351 | ($1047) | (20%) |
| Effective Tax Rate | 23.7% | 23.6% | 23.5% | 23.3% | 21.6% |  |  | 23.5% | 22.9% |  |  |
| Net Interest Margin | 11.27% | 11.05% | 10.94% | 10.85% | 10.81% | 46 | bps | 11.04% | 10.76% | 28 | bps |
| Operating Efficiency | 40.0% | 39.9% | 37.9% | 38.9% | 44.7% | (470) | bps | 39.3% | 39.8% | (50) | bps |
| ROE | 28% | 29% | 32% | 37% | 32% |  |  | 31% | 43% |  |  |
| ROCE | 30% | 30% | 35% | 39% | 35% |  |  | 33% | 46% |  |  |
| Capital Returned to Common Stockholders | $743 | $350 | $742 | $1067 | $895 | ($152) | (17%) | $2902 | $2715 | $187 | 7% |
| Payout Ratio | 72% | 36% | 67% | 89% | 84% |  |  | 67% | 51% |  |  |
| Ending Common Shares Outstanding | 267 | 273 | 275 | 281 | 288 | (21) | (7%) | 267 | 288 | (21) | (7%) |
| Weighted Average Common Shares Outstanding | 272 | 273 | 279 | 285 | 291 | (19) | (7%) | 277 | 300 | (23) | (8%) |
| Weighted Average Common Shares Outstanding (fully diluted) | 273 | 274 | 279 | 285 | 292 | (19) | (7%) | 278 | 300 | (22) | (7%) |
| **<u>PER SHARE STATISTICS</u>** |  |  |  |  |  |  |  |  |  |  |  |
| Basic EPS | $3.77 | $3.54 | $3.96 | $4.23 | $3.64 | $0.13 | 4% | $15.52 | $17.85 | ($2.33) | (13%) |
| Diluted EPS | $3.77 | $3.54 | $3.96 | $4.22 | $3.64 | $0.13 | 4% | $15.50 | $17.83 | ($2.33) | (13%) |
| Common Dividends Declared Per Share | $0.60 | $0.60 | $0.60 | $0.50 | $0.50 | $0.10 | 20% | $2.30 | $1.88 | $0.42 | 22% |
| Common Stock Price (period end) | $97.83 | $90.92 | $94.58 | $110.19 | $115.56 | ($17.73) | (15%) | $97.83 | $115.56 | ($17.73) | (15%) |
| Book Value per share | $54.57 | $52.29 | $50.00 | $47.81 | $46.50 | $8.07 | 17% | $54.57 | $46.50 | $8.07 | 17% |
| &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms |  |  |  |  |

---

------

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** |
| **BALANCE SHEET SUMMARY** | **BALANCE SHEET SUMMARY** | **BALANCE SHEET SUMMARY** | **BALANCE SHEET SUMMARY** | **BALANCE SHEET SUMMARY** | **BALANCE SHEET SUMMARY** | **BALANCE SHEET SUMMARY** | **BALANCE SHEET SUMMARY** |
| **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** |
| | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | | |
| | **Dec 31, 2022** | **Sep 30, 2022** | **Jun 30, 2022** | **Mar 31, 2022** | **Dec 31, 2021** | **Dec 31, 2022 vs. Dec 31, 2021** | **Dec 31, 2022 vs. Dec 31, 2021** |
| **<u>BALANCE SHEET SUMMARY</u>** | | | | | | | |
| **Assets** | | | | | | | |
| Cash and Investment Securities | $21105 | $18767 | $17007 | $15620 | $18236 | $2869 | 16% |
| Total Loan Receivables | 112120 | 104908 | 99301 | 93471 | 93684 | 18436 | 20% |
| Allowance for Credit Losses | (7374) | (7061) | (6757) | (6647) | (6822) | (552) | (8%) |
| Net Loan Receivables | 104746 | 97847 | 92544 | 86824 | 86862 | 17884 | 21% |
| Premises and Equipment, net | 1003 | 1015 | 984 | 984 | 983 | 20 | 2% |
| Goodwill and Intangible Assets, net | 255 | 255 | 255 | 255 | 255 |  | —% |
| Other Assets | 4519 | 4002 | 3810 | 3729 | 3906 | 613 | 16% |
| &nbsp;&nbsp;&nbsp;**Total Assets** | $131628 | $121886 | $114600 | $107412 | $110242 | $21386 | 19% |
| **Liabilities & Stockholders' Equity** |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Certificates of Deposits <sup>1</sup> | $16124 | $14505 | $13543 | $13518 | $14391 | $1733 | 12% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Savings, Money Market, and Other Deposits <sup>1, 2</sup> | 54397 | 51743 | 49655 | 50185 | 47548 | 6849 | 14% |
| &nbsp;&nbsp;&nbsp;Total Direct to Consumer Deposits <sup>1, 2</sup> | 70521 | 66248 | 63198 | 63703 | 61939 | 8582 | 14% |
| &nbsp;&nbsp;&nbsp;&nbsp;Brokered Deposits and Other Deposits | 21115 | 16649 | 13214 | 8779 | 10454 | 10661 | 102% |
| Deposits | 91636 | 82897 | 76412 | 72482 | 72393 | 19243 | 27% |
| &nbsp;&nbsp;&nbsp;&nbsp;Securitized Borrowings <sup>3</sup> | 10259 | 11092 | 9099 | 7715 | 9539 | 720 | 8% |
| &nbsp;&nbsp;&nbsp;&nbsp;Other Borrowings <sup>3</sup> | 9849 | 9085 | 10886 | 9417 | 10688 | (839) | (8%) |
| Borrowings | 20108 | 20177 | 19985 | 17132 | 20227 | (119) | (1%) |
| Accrued Expenses and Other Liabilities | 5294 | 4526 | 4439 | 4365 | 4214 | 1080 | 26% |
| &nbsp;&nbsp;&nbsp;&nbsp;Total Liabilities | 117038 | 107600 | 100836 | 93979 | 96834 | 20204 | 21% |
| Total Equity | 14590 | 14286 | 13764 | 13433 | 13408 | 1182 | 9% |
| &nbsp;&nbsp;&nbsp;**Total Liabilities and Stockholders' Equity** | $131628 | $121886 | $114600 | $107412 | $110242 | $21386 | 19% |
| **<u>LIQUIDITY</u>** |  |  |  |  |  |  |  |
| Liquidity Portfolio | $19798 | $16042 | $16204 | $14910 | $14959 | $4839 | 32% |
| Private Asset-backed Securitizations | 3500 | 3500 | 3500 | 3750 | 3500 |  | —% |
| Federal Home Loan Bank Borrowing Capacity | 1712 | 2078 | 12 | 1505 | 150 | 1562 | NM |
| Federal Reserve Discount Window <sup>4</sup> | 42268 | 39888 | 36463 | 34393 | 34254 | 8014 | 23% |
| Undrawn Credit Facilities <sup>4</sup> | 47480 | 45466 | 39975 | 39648 | 37904 | 9576 | 25% |
| Total Liquidity | $67278 | $61508 | $56179 | $54558 | $52863 | $14415 | 27% |
| <sup>1</sup> Includes Affinity relationships | <sup>1</sup> Includes Affinity relationships | <sup>1</sup> Includes Affinity relationships | <sup>1</sup> Includes Affinity relationships | <sup>1</sup> Includes Affinity relationships | <sup>1</sup> Includes Affinity relationships | <sup>1</sup> Includes Affinity relationships | <sup>1</sup> Includes Affinity relationships |
| <sup>2</sup> Savings, Money Market, and Other Deposits and reflects both interest-bearing and non-interest bearing direct to consumer deposits | <sup>2</sup> Savings, Money Market, and Other Deposits and reflects both interest-bearing and non-interest bearing direct to consumer deposits | <sup>2</sup> Savings, Money Market, and Other Deposits and reflects both interest-bearing and non-interest bearing direct to consumer deposits | <sup>2</sup> Savings, Money Market, and Other Deposits and reflects both interest-bearing and non-interest bearing direct to consumer deposits | <sup>2</sup> Savings, Money Market, and Other Deposits and reflects both interest-bearing and non-interest bearing direct to consumer deposits | <sup>2</sup> Savings, Money Market, and Other Deposits and reflects both interest-bearing and non-interest bearing direct to consumer deposits | <sup>2</sup> Savings, Money Market, and Other Deposits and reflects both interest-bearing and non-interest bearing direct to consumer deposits | <sup>2</sup> Savings, Money Market, and Other Deposits and reflects both interest-bearing and non-interest bearing direct to consumer deposits |
| <sup>3</sup> Includes short-term and long-term borrowings | <sup>3</sup> Includes short-term and long-term borrowings | <sup>3</sup> Includes short-term and long-term borrowings | <sup>3</sup> Includes short-term and long-term borrowings | <sup>3</sup> Includes short-term and long-term borrowings | <sup>3</sup> Includes short-term and long-term borrowings | <sup>3</sup> Includes short-term and long-term borrowings | <sup>3</sup> Includes short-term and long-term borrowings |
| <sup>4</sup> Excludes investments pledged to the Federal Reserve, which is included within the liquidity portfolio | <sup>4</sup> Excludes investments pledged to the Federal Reserve, which is included within the liquidity portfolio | <sup>4</sup> Excludes investments pledged to the Federal Reserve, which is included within the liquidity portfolio | <sup>4</sup> Excludes investments pledged to the Federal Reserve, which is included within the liquidity portfolio | <sup>4</sup> Excludes investments pledged to the Federal Reserve, which is included within the liquidity portfolio | <sup>4</sup> Excludes investments pledged to the Federal Reserve, which is included within the liquidity portfolio | <sup>4</sup> Excludes investments pledged to the Federal Reserve, which is included within the liquidity portfolio | <sup>4</sup> Excludes investments pledged to the Federal Reserve, which is included within the liquidity portfolio |
| Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms |  |  |  |  |  |  |

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** |
| **BALANCE SHEET STATISTICS** | **BALANCE SHEET STATISTICS** | **BALANCE SHEET STATISTICS** | **BALANCE SHEET STATISTICS** | **BALANCE SHEET STATISTICS** | **BALANCE SHEET STATISTICS** | **BALANCE SHEET STATISTICS** | **BALANCE SHEET STATISTICS** |
| **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** |
| | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | | |
| | **Dec 31, 2022** | **Sep 30, 2022** | **Jun 30, 2022** | **Mar 31, 2022** | **Dec 31, 2021** | **Dec 31, 2022 vs. Dec 31, 2021** | **Dec 31, 2022 vs. Dec 31, 2021** |
| **<u>BALANCE SHEET STATISTICS</u>** | | | | | | | |
| Total Common Equity | $13534 | $13230 | $12708 | $12377 | $12352 | $1182 | 10% |
| Total Common Equity/Total Assets | 10.3% | 10.9% | 11.1% | 11.5% | 11.2% |  |  |
| Total Common Equity/Net Loans | 12.9% | 13.5% | 13.7% | 14.3% | 14.2% |  |  |
| Tangible Assets | $131373 | $121631 | $114345 | $107157 | $109987 | $21386 | 19% |
| Tangible Common Equity <sup>1</sup> | $13279 | $12975 | $12453 | $12122 | $12097 | $1182 | 10% |
| Tangible Common Equity/Tangible Assets <sup>1</sup> | 10.1% | 10.7% | 10.9% | 11.3% | 11.0% |  |  |
| Tangible Common Equity/Net Loans <sup>1</sup> | 12.7% | 13.3% | 13.5% | 14.0% | 13.9% |  |  |
| Tangible Common Equity per share <sup>1</sup> | $49.66 | $47.49 | $45.24 | $43.14 | $41.96 | $7.70 | 18% |
|  | **Basel III** | **Basel III** | **Basel III** | **Basel III** | **Basel III** |  |  |
|  | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** |  |  |
| **<u>REGULATORY CAPITAL RATIOS</u>** <sup>2</sup> | **Dec 31, 2022** | **Sep 30, 2022** | **Jun 30, 2022** | **Mar 31, 2022** | **Dec 31, 2021** |  |  |
| Total Risk Based Capital Ratio | 16.0% | 16.7% | 17.0% | 17.6% | 17.6% |  |  |
| Tier 1 Risk Based Capital Ratio | 14.3% | 14.9% | 15.2% | 15.8% | 15.8% |  |  |
| Tier 1 Leverage Ratio | 12.7% | 13.4% | 13.9% | 13.7% | 13.9% |  |  |
| Common Equity Tier 1 Capital Ratio | 13.3% | 13.9% | 14.2% | 14.7% | 14.8% |  |  |
| 1 Tangible Common Equity ("TCE") is a non-GAAP measure. The Company believes TCE is a more meaningful measure to investors of the net asset value of the Company. For corresponding reconciliation of TCE to a GAAP financial measure see Reconciliation of GAAP to non-GAAP Data schedule | 1 Tangible Common Equity ("TCE") is a non-GAAP measure. The Company believes TCE is a more meaningful measure to investors of the net asset value of the Company. For corresponding reconciliation of TCE to a GAAP financial measure see Reconciliation of GAAP to non-GAAP Data schedule | 1 Tangible Common Equity ("TCE") is a non-GAAP measure. The Company believes TCE is a more meaningful measure to investors of the net asset value of the Company. For corresponding reconciliation of TCE to a GAAP financial measure see Reconciliation of GAAP to non-GAAP Data schedule | 1 Tangible Common Equity ("TCE") is a non-GAAP measure. The Company believes TCE is a more meaningful measure to investors of the net asset value of the Company. For corresponding reconciliation of TCE to a GAAP financial measure see Reconciliation of GAAP to non-GAAP Data schedule | 1 Tangible Common Equity ("TCE") is a non-GAAP measure. The Company believes TCE is a more meaningful measure to investors of the net asset value of the Company. For corresponding reconciliation of TCE to a GAAP financial measure see Reconciliation of GAAP to non-GAAP Data schedule | 1 Tangible Common Equity ("TCE") is a non-GAAP measure. The Company believes TCE is a more meaningful measure to investors of the net asset value of the Company. For corresponding reconciliation of TCE to a GAAP financial measure see Reconciliation of GAAP to non-GAAP Data schedule | 1 Tangible Common Equity ("TCE") is a non-GAAP measure. The Company believes TCE is a more meaningful measure to investors of the net asset value of the Company. For corresponding reconciliation of TCE to a GAAP financial measure see Reconciliation of GAAP to non-GAAP Data schedule | 1 Tangible Common Equity ("TCE") is a non-GAAP measure. The Company believes TCE is a more meaningful measure to investors of the net asset value of the Company. For corresponding reconciliation of TCE to a GAAP financial measure see Reconciliation of GAAP to non-GAAP Data schedule |
| 2 Based on the final rule published September 30, 2020. Capital ratios reflect delay in the recognition of the impact of CECL reserves on regulatory capital for two years in accordance with the final rule | 2 Based on the final rule published September 30, 2020. Capital ratios reflect delay in the recognition of the impact of CECL reserves on regulatory capital for two years in accordance with the final rule | 2 Based on the final rule published September 30, 2020. Capital ratios reflect delay in the recognition of the impact of CECL reserves on regulatory capital for two years in accordance with the final rule | 2 Based on the final rule published September 30, 2020. Capital ratios reflect delay in the recognition of the impact of CECL reserves on regulatory capital for two years in accordance with the final rule | 2 Based on the final rule published September 30, 2020. Capital ratios reflect delay in the recognition of the impact of CECL reserves on regulatory capital for two years in accordance with the final rule | 2 Based on the final rule published September 30, 2020. Capital ratios reflect delay in the recognition of the impact of CECL reserves on regulatory capital for two years in accordance with the final rule | 2 Based on the final rule published September 30, 2020. Capital ratios reflect delay in the recognition of the impact of CECL reserves on regulatory capital for two years in accordance with the final rule | 2 Based on the final rule published September 30, 2020. Capital ratios reflect delay in the recognition of the impact of CECL reserves on regulatory capital for two years in accordance with the final rule |
| &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms |

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** |
| **AVERAGE BALANCE SHEET** | **AVERAGE BALANCE SHEET** | **AVERAGE BALANCE SHEET** | **AVERAGE BALANCE SHEET** | **AVERAGE BALANCE SHEET** | **AVERAGE BALANCE SHEET** | **AVERAGE BALANCE SHEET** | **AVERAGE BALANCE SHEET** |
| **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** |
| | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | | |
| | **Dec 31, 2022** | **Sep 30, 2022** | **Jun 30, 2022** | **Mar 31, 2022** | **Dec 31, 2021** | **Dec 31, 2022 vs. Dec 31, 2021** | **Dec 31, 2022 vs. Dec 31, 2021** |
| **<u>AVERAGE BALANCES</u>** | | | | | | | |
| **Assets** | | | | | | | |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and Investment Securities | $19529 | $16057 | $14409 | $15028 | $17309 | $2220 | 13% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Restricted Cash | 393 | 853 | 40 | 774 | 1164 | (771) | (66%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Credit Card Loans | 86396 | 81445 | 75917 | 73042 | 71865 | 14531 | 20% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Private Student Loans | 10284 | 10132 | 10164 | 10381 | 10094 | 190 | 2% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Personal Loans | 7871 | 7408 | 6981 | 6909 | 6923 | 948 | 14% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Loans | 3485 | 3050 | 2674 | 2359 | 2213 | 1272 | 57% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Loans | 108036 | 102035 | 95736 | 92691 | 91095 | 16941 | 19% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Interest Earning Assets | 127958 | 118945 | 110185 | 108493 | 109568 | 18390 | 17% |
| Allowance for Credit Losses | (7059) | (6758) | (6644) | (6818) | (6847) | (212) | (3%) |
| Other Assets | 6235 | 5923 | 5874 | 6248 | 6379 | (144) | (2%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Assets | $127134 | $118110 | $109415 | $107923 | $109100 | $18034 | 17% |
| **Liabilities and Stockholders' Equity** |  |  |  |  |  |  |  |
| Non-Interest-bearing Direct to Consumer Deposits <sup>1</sup> | $1062 | $1122 | $1136 | $1090 | $1016 | $46 | 5% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Certificates of Deposits <sup>1</sup> | $15189 | $14029 | $13391 | $14035 | $14606 | $583 | 4% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Savings, Money Market, and Other Deposits <sup>1</sup> | 51703 | 49332 | 48504 | 47426 | 46213 | 5490 | 12% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing Direct to Consumer Deposits <sup>1</sup> | 66892 | 63361 | 61895 | 61461 | 60819 | 6073 | 10% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Brokered Deposits and Other Deposits | 19165 | 14722 | 10031 | 9157 | 9834 | 9331 | 95% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Interest-bearing Deposits | 86057 | 78083 | 71926 | 70618 | 70653 | 15404 | 22% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Securitized Borrowings <sup>2</sup> | 9954 | 10246 | 8262 | 7739 | 9119 | 835 | 9% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Borrowings <sup>2</sup> | 9636 | 9185 | 9325 | 10099 | 9721 | (85) | (1%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Interest-bearing Liabilities | 105647 | 97514 | 89513 | 88456 | 89493 | 16154 | 18% |
| Other Liabilities & Stockholders' Equity | 20425 | 19474 | 18766 | 18377 | 18591 | 1834 | 10% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Liabilities and Stockholders' Equity | $127134 | $118110 | $109415 | $107923 | $109100 | $18034 | 17% |
| **<u>AVERAGE YIELD</u>** |  |  |  |  |  |  |  |
| **Assets** |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and Investment Securities | 3.45% | 2.31% | 1.46% | 1.09% | 1.01% | 244 | bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Restricted Cash | 2.73% | 2.25% | 0.41% | 0.02% | 0.03% | 270 | bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Credit Card Loans | 14.50% | 13.56% | 12.81% | 12.59% | 12.50% | 200 | bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Private Student Loans | 9.02% | 8.26% | 7.74% | 7.41% | 7.37% | 165 | bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Personal Loans | 12.04% | 11.83% | 11.84% | 12.09% | 12.36% | (32) | bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Loans | 6.16% | 5.70% | 5.47% | 5.60% | 5.39% | 77 | bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Loans | 13.53% | 12.67% | 12.00% | 11.80% | 11.75% | 178 | bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Interest Earning Assets | 11.96% | 11.20% | 10.61% | 10.23% | 9.93% | 203 | bps |
| **<u>AVERAGE RATES</u>** |  |  |  |  |  |  |  |
| **Liabilities and Stockholders' Equity** |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Certificates of Deposits <sup>1</sup> | 1.83% | 1.31% | 1.04% | 1.02% | 1.07% | 76 | bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Savings, Money Market, and Other Deposits <sup>1</sup> | 2.76% | 1.60% | 0.68% | 0.50% | 0.42% | 234 | bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing Direct to Consumer Deposits <sup>1</sup> | 2.55% | 1.53% | 0.75% | 0.62% | 0.58% | 197 | bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Brokered Deposits and Other Deposits | 3.50% | 2.71% | 2.28% | 2.03% | 2.16% | 134 | bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Interest-bearing Deposits | 2.76% | 1.76% | 0.97% | 0.80% | 0.80% | 196 | bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Securitized Borrowings <sup>2</sup> | 3.33% | 2.79% | 1.87% | 1.29% | 1.09% | 224 | bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Borrowings <sup>2</sup> | 4.37% | 4.17% | 3.97% | 3.75% | 3.75% | 62 | bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Interest-bearing Liabilities | 2.96% | 2.09% | 1.36% | 1.18% | 1.15% | 181 | bps |
| Net Interest Margin | 11.27% | 11.05% | 10.94% | 10.85% | 10.81% | 46 | bps |
| Net Yield on Interest-earning Assets | 9.51% | 9.48% | 9.50% | 9.27% | 8.99% | 52 | bps |
| <sup>1</sup> Includes Affinity relationships | <sup>1</sup> Includes Affinity relationships | <sup>1</sup> Includes Affinity relationships | <sup>1</sup> Includes Affinity relationships | <sup>1</sup> Includes Affinity relationships | <sup>1</sup> Includes Affinity relationships | <sup>1</sup> Includes Affinity relationships | <sup>1</sup> Includes Affinity relationships |
| <sup>2</sup> Includes short-term and long-term borrowings | <sup>2</sup> Includes short-term and long-term borrowings | <sup>2</sup> Includes short-term and long-term borrowings | <sup>2</sup> Includes short-term and long-term borrowings | <sup>2</sup> Includes short-term and long-term borrowings | <sup>2</sup> Includes short-term and long-term borrowings | <sup>2</sup> Includes short-term and long-term borrowings | <sup>2</sup> Includes short-term and long-term borrowings |
| Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms |

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| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | | | | |
| **LOAN STATISTICS** | **LOAN STATISTICS** | **LOAN STATISTICS** | **LOAN STATISTICS** | **LOAN STATISTICS** | **LOAN STATISTICS** | **LOAN STATISTICS** | **LOAN STATISTICS** | | | | |
| **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | | | | |
| | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | | | **Twelve Months Ended** | **Twelve Months Ended** | | |
| | **Dec 31,<br>2022** | **Sep 30,<br>2022** | **Jun 30,<br>2022** | **Mar 31,<br>2022** | **Dec 31,<br>2021** | **Dec 31, 2022 vs. Dec 31, 2021** | **Dec 31, 2022 vs. Dec 31, 2021** | **Dec 31,<br>2022** | **Dec 31,<br>2021** | **2022 vs. 2021** | **2022 vs. 2021** |
| **<u>TOTAL LOAN RECEIVABLES</u>** | | | | | | | | | | | |
| Ending Loans <sup>1</sup> | $112120 | $104908 | $99301 | $93471 | $93684 | $18436 | 20% | $112120 | $93684 | $18436 | 20% |
| Average Loans <sup>1</sup> | $108036 | $102035 | $95736 | $92691 | $91095 | $16941 | 19% | $99673 | $88421 | $11252 | 13% |
| Interest Yield | 13.53% | 12.67% | 12.00% | 11.80% | 11.75% | 178 | bps | 12.54% | 11.82% | 72 | bps |
| Gross Principal Charge-off Rate | 2.87% | 2.56% | 2.76% | 2.64% | 2.36% | 51 | bps | 2.71% | 2.87% | (16) | bps |
| Net Principal Charge-off Rate | 2.13% | 1.71% | 1.80% | 1.61% | 1.37% | 76 | bps | 1.82% | 1.84% | (2) | bps |
| Delinquency Rate (30 or more days) | 2.30% | 1.94% | 1.63% | 1.64% | 1.55% | 75 | bps | 2.30% | 1.55% | 75 | bps |
| Delinquency Rate (90 or more days) | 0.98% | 0.80% | 0.70% | 0.72% | 0.66% | 32 | bps | 0.98% | 0.66% | 32 | bps |
| Gross Principal Charge-off Dollars | $781 | $659 | $659 | $603 | $543 | $238 | 44% | $2702 | $2534 | $168 | 7% |
| Net Principal Charge-off Dollars | $581 | $439 | $429 | $368 | $313 | $268 | 86% | $1817 | $1631 | $186 | 11% |
| Net Interest and Fee Charge-off Dollars | $126 | $98 | $92 | $87 | $70 | $56 | 80% | $403 | $361 | $42 | 12% |
| Loans Delinquent 30 or more days | $2578 | $2034 | $1621 | $1537 | $1451 | $1127 | 78% | $2578 | $1451 | $1127 | 78% |
| Loans Delinquent 90 or more days | $1101 | $837 | $694 | $678 | $618 | $483 | 78% | $1101 | $618 | $483 | 78% |
| Allowance for Credit Losses (period end) | $7374 | $7061 | $6757 | $6647 | $6822 | $552 | 8% | $7374 | $6822 | $552 | 8% |
| Reserve Change Build/ (Release) <sup>2</sup> | $313 | $304 | $110 | ($175) | ($39) | $352 |  | $552 | ($1404) | $1956 |  |
| Reserve Rate | 6.58% | 6.73% | 6.80% | 7.11% | 7.28% | (70) | bps | 6.58% | 7.28% | (70) | bps |
| **<u>CREDIT CARD LOANS</u>** |  |  |  |  |  |  |  |  |  |  |  |
| Ending Loans | $90113 | $83630 | $79237 | $73783 | $74369 | $15744 | 21% | $90113 | $74369 | $15744 | 21% |
| Average Loans | $86396 | $81445 | $75917 | $73042 | $71865 | $14531 | 20% | $79243 | $69365 | $9878 | 14% |
| Interest Yield | 14.50% | 13.56% | 12.81% | 12.59% | 12.50% | 200 | bps | 13.42% | 12.57% | 85 | bps |
| Gross Principal Charge-off Rate | 3.20% | 2.88% | 3.10% | 3.00% | 2.63% | 57 | bps | 3.05% | 3.25% | (20) | bps |
| Net Principal Charge-off Rate | 2.37% | 1.92% | 2.01% | 1.84% | 1.50% | 87 | bps | 2.05% | 2.09% | (4) | bps |
| Delinquency Rate (30 or more days) | 2.53% | 2.11% | 1.76% | 1.77% | 1.66% | 87 | bps | 2.53% | 1.66% | 87 | bps |
| Delinquency Rate (90 or more days) | 1.14% | 0.92% | 0.80% | 0.83% | 0.76% | 38 | bps | 1.14% | 0.76% | 38 | bps |
| Gross Principal Charge-off Dollars | $697 | $592 | $587 | $541 | $477 | $220 | 46% | $2417 | $2255 | $162 | 7% |
| Net Principal Charge-off Dollars | $516 | $395 | $381 | $331 | $272 | $244 | 90% | $1623 | $1447 | $176 | 12% |
| Loans Delinquent 30 or more days | $2278 | $1761 | $1392 | $1305 | $1232 | $1046 | 85% | $2278 | $1232 | $1046 | 85% |
| Loans Delinquent 90 or more days | $1028 | $770 | $633 | $613 | $562 | $466 | 83% | $1028 | $562 | $466 | 83% |
| Allowance for Credit Losses (period end) | $5883 | $5561 | $5307 | $5120 | $5273 | $610 | 12% | $5883 | $5273 | $610 | 12% |
| Reserve Change Build/ (Release) <sup>2</sup> | $322 | $254 | $187 | ($153) | ($25) | $347 |  | $610 | ($1218) | $1828 |  |
| Reserve Rate | 6.53% | 6.65% | 6.70% | 6.94% | 7.09% | (56) | bps | 6.53% | 7.09% | (56) | bps |
| Total Discover Card Volume | $59153 | $58561 | $57384 | $49379 | $53983 | $5170 | 10% | $224477 | $192755 | $31722 | 16% |
| Discover Card Sales Volume | $55663 | $54793 | $53860 | $46329 | $51308 | $4355 | 8% | $210645 | $182125 | $28520 | 16% |
| Rewards Rate | 1.42% | 1.47% | 1.37% | 1.36% | 1.35% | 7 | bps | 1.41% | 1.37% | 4 | bps |
| <sup>1</sup> Total Loans includes Home Equity and other loans | <sup>1</sup> Total Loans includes Home Equity and other loans | <sup>1</sup> Total Loans includes Home Equity and other loans | <sup>1</sup> Total Loans includes Home Equity and other loans | <sup>1</sup> Total Loans includes Home Equity and other loans | <sup>1</sup> Total Loans includes Home Equity and other loans | <sup>1</sup> Total Loans includes Home Equity and other loans | <sup>1</sup> Total Loans includes Home Equity and other loans | <sup>1</sup> Total Loans includes Home Equity and other loans | <sup>1</sup> Total Loans includes Home Equity and other loans | <sup>1</sup> Total Loans includes Home Equity and other loans | <sup>1</sup> Total Loans includes Home Equity and other loans |
| <sup>2</sup> Excludes any build/release of the liability for expected credit losses on unfunded commitments as the offset is recorded in accrued expenses and other liabilities in the Company's condensed consolidated statements of financial condition | <sup>2</sup> Excludes any build/release of the liability for expected credit losses on unfunded commitments as the offset is recorded in accrued expenses and other liabilities in the Company's condensed consolidated statements of financial condition | <sup>2</sup> Excludes any build/release of the liability for expected credit losses on unfunded commitments as the offset is recorded in accrued expenses and other liabilities in the Company's condensed consolidated statements of financial condition | <sup>2</sup> Excludes any build/release of the liability for expected credit losses on unfunded commitments as the offset is recorded in accrued expenses and other liabilities in the Company's condensed consolidated statements of financial condition | <sup>2</sup> Excludes any build/release of the liability for expected credit losses on unfunded commitments as the offset is recorded in accrued expenses and other liabilities in the Company's condensed consolidated statements of financial condition | <sup>2</sup> Excludes any build/release of the liability for expected credit losses on unfunded commitments as the offset is recorded in accrued expenses and other liabilities in the Company's condensed consolidated statements of financial condition | <sup>2</sup> Excludes any build/release of the liability for expected credit losses on unfunded commitments as the offset is recorded in accrued expenses and other liabilities in the Company's condensed consolidated statements of financial condition | <sup>2</sup> Excludes any build/release of the liability for expected credit losses on unfunded commitments as the offset is recorded in accrued expenses and other liabilities in the Company's condensed consolidated statements of financial condition |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms | &nbsp;&nbsp;&nbsp;&nbsp;Note: See Glossary of Financial Terms for definitions of financial terms |  |  |  |  |  |  |  |  |

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| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | | | | |
| **LOAN STATISTICS** | **LOAN STATISTICS** | **LOAN STATISTICS** | **LOAN STATISTICS** | **LOAN STATISTICS** | **LOAN STATISTICS** | **LOAN STATISTICS** | **LOAN STATISTICS** | | | | |
| **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | | | | |
| | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | | | **Twelve Months Ended** | **Twelve Months Ended** | | |
| | **Dec 31, 2022** | **Sep 30, 2022** | **Jun 30, 2022** | **Mar 31, 2022** | **Dec 31, 2021** | **Dec 31, 2022 vs. Dec 31, 2021** | **Dec 31, 2022 vs. Dec 31, 2021** | **Dec 31, 2022** | **Dec 31, 2021** | **2022 vs. 2021** | **2022 vs. 2021** |
| **<u>PRIVATE STUDENT LOANS</u>** | | | | | | | | | | | |
| Organic Student Loans | $9718 | $9722 | $9412 | $9614 | $9367 | $351 | 4% | $9718 | $9367 | $351 | 4% |
| Purchased Student Loans | 590 | 627 | 662 | 700 | 746 | (156) | (21%) | 590 | 746 | (156) | (21%) |
| Total Private Student Loans | $10308 | $10349 | $10074 | $10314 | $10113 | $195 | 2% | $10308 | $10113 | $195 | 2% |
| Interest Yield | 9.02% | 8.26% | 7.74% | 7.41% | 7.37% | 165 | bps | 8.11% | 7.38% | 73 | bps |
| Net Principal Charge-off Rate | 1.33% | 0.91% | 1.08% | 0.69% | 0.80% | 53 | bps | 1.00% | 0.63% | 37 | bps |
| Delinquency Rate (30 or more days) | 2.05% | 1.94% | 1.66% | 1.62% | 1.55% | 50 | bps | 2.05% | 1.55% | 50 | bps |
| Reserve Rate | 8.14% | 8.01% | 8.26% | 8.43% | 8.33% | (19) | bps | 8.14% | 8.33% | (19) | bps |
| **<u>PERSONAL LOANS</u>** |  |  |  |  |  |  |  |  |  |  |  |
| Ending Loans | $7998 | $7674 | $7145 | $6904 | $6936 | $1062 | 15% | $7998 | $6936 | $1062 | 15% |
| Interest Yield | 12.04% | 11.83% | 11.84% | 12.09% | 12.36% | (32) | bps | 11.95% | 12.64% | (69) | bps |
| Net Principal Charge-off Rate | 1.49% | 1.14% | 1.21% | 1.12% | 1.21% | 28 | bps | 1.25% | 1.73% | (48) | bps |
| Delinquency Rate (30 or more days) | 0.80% | 0.69% | 0.63% | 0.69% | 0.69% | 11 | bps | 0.80% | 0.69% | 11 | bps |
| Reserve Rate | 7.44% | 8.08% | 8.01% | 8.88% | 9.54% | (210) | bps | 7.44% | 9.54% | (210) | bps |
| Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms |  |  |  |  |

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| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | | | | |
| **SEGMENT RESULTS AND VOLUME STATISTICS** | **SEGMENT RESULTS AND VOLUME STATISTICS** | **SEGMENT RESULTS AND VOLUME STATISTICS** | **SEGMENT RESULTS AND VOLUME STATISTICS** | **SEGMENT RESULTS AND VOLUME STATISTICS** | **SEGMENT RESULTS AND VOLUME STATISTICS** | **SEGMENT RESULTS AND VOLUME STATISTICS** | **SEGMENT RESULTS AND VOLUME STATISTICS** | | | | |
| **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | | | | |
| | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | | | **Twelve Months Ended** | **Twelve Months Ended** | | |
| | **Dec 31, 2022** | **Sep 30, 2022** | **Jun 30, 2022** | **Mar 31, 2022** | **Dec 31, 2021** | **Dec 31, 2022 vs. Dec 31, 2021** | **Dec 31, 2022 vs. Dec 31, 2021** | **Dec 31, 2022** | **Dec 31, 2021** | **2022 vs. 2021** | **2022 vs. 2021** |
| **<u>DIGITAL BANKING</u>** | | | | | | | | | | | |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest Income | $3856 | $3357 | $2915 | $2736 | $2742 | $1114 | 41% | $12864 | $10651 | $2213 | 21% |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest Expense | 789 | 514 | 305 | 257 | 259 | 530 | NM | 1865 | 1134 | 731 | 64% |
| Net Interest Income | 3067 | 2843 | 2610 | 2479 | 2483 | 584 | 24% | 10999 | 9517 | 1482 | 16% |
| Non-Interest Income | 578 | 541 | 557 | 486 | 497 | 81 | 16% | 2162 | 1781 | 381 | 21% |
| Revenue Net of Interest Expense | 3645 | 3384 | 3167 | 2965 | 2980 | 665 | 22% | 13161 | 11298 | 1863 | 16% |
| Provision for Credit Losses | 883 | 773 | 549 | 154 | 263 | 620 | NM | 2359 | 218 | 2141 | NM |
| Total Operating Expense | 1445 | 1346 | 1186 | 1092 | 1259 | 186 | 15% | 5069 | 4549 | 520 | 11% |
| Income/ (Loss) Before Income Taxes | $1317 | $1265 | $1432 | $1719 | $1458 | ($141) | (10%) | $5733 | $6531 | ($798) | (12%) |
| Net Interest Margin | 11.27% | 11.05% | 10.94% | 10.85% | 10.81% | 46 | bps | 11.04% | 10.76% | 28 | bps |
| Pretax Return on Loan Receivables | 4.84% | 4.91% | 5.99% | 7.52% | 6.35% | (151) | bps | 5.75% | 7.39% | (164) | bps |
| Allowance for Credit Losses (period end) | $7374 | $7061 | $6757 | $6647 | $6822 | $552 | 8% | $7374 | $6822 | $552 | 8% |
| Reserve Change Build/ (Release) | $313 | $304 | $110 | ($175) | ($39) | $352 |  | $552 | ($1404) | $1956 |  |
| **<u>PAYMENT SERVICES</u>** |  |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest Income | $— | $— | $— | $— | $— | $— | NM | $— | $— | $— | NM |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest Expense |  |  |  |  |  |  | NM |  |  |  | NM |
| Net Interest Income |  |  |  |  |  |  | NM |  |  |  | NM |
| Non-Interest Income/ (Loss) | 87 | 95 | 57 | (63) | (44) | 131 | NM | 176 | 789 | (613) | (78%) |
| Revenue Net of Interest Expense | 87 | 95 | 57 | (63) | (44) | 131 | NM | 176 | 789 | (613) | (78%) |
| Provision for Credit Losses |  |  |  |  |  |  | NM |  |  |  | NM |
| Total Operating Expense | 50 | 42 | 37 | 38 | 53 | (3) | (6%) | 167 | 256 | (89) | (35%) |
| Income/ (Loss) Before Income Taxes | $37 | $53 | $20 | ($101) | ($97) | $134 | 138% | $9 | $533 | ($524) | (98%) |
| **<u>TRANSACTIONS PROCESSED ON NETWORKS</u>** |  |  |  |  |  |  |  |  |  |  |  |
| Discover Network | 946 | 924 | 916 | 831 | 914 | 32 | 4% | 3617 | 3259 | 358 | 11% |
| PULSE Network | 1666 | 1611 | 1524 | 1399 | 1508 | 158 | 10% | 6200 | 5632 | 568 | 10% |
| Total | 2612 | 2535 | 2440 | 2230 | 2422 | 190 | 8% | 9817 | 8891 | 926 | 10% |
| **<u>NETWORK VOLUME</u>** |  |  |  |  |  |  |  |  |  |  |  |
| PULSE Network | $66807 | $63437 | $62992 | $59836 | $64787 | $2020 | 3% | $253072 | $247913 | $5159 | 2% |
| Network Partners | 10433 | 11894 | 11532 | 10683 | 11233 | (800) | (7%) | 44542 | 40707 | 3835 | 9% |
| Diners Club International <sup>1</sup> | 9155 | 8793 | 8381 | 7176 | 7367 | 1788 | 24% | 33505 | 25937 | 7568 | 29% |
| Total Payment Services | 86395 | 84124 | 82905 | 77695 | 83387 | 3008 | 4% | 331119 | 314557 | 16562 | 5% |
| Discover Network - Proprietary | 58138 | 56633 | 55838 | 48129 | 53197 | 4941 | 9% | 218738 | 188960 | 29778 | 16% |
| Total | $144533 | $140757 | $138743 | $125824 | $136584 | $7949 | 6% | $549857 | $503517 | $46340 | 9% |
| <sup>1</sup> Volume is derived from data provided by licencees for Diners Club branded cards issued outside of North America and is subject to subsequent revision or amendment  | <sup>1</sup> Volume is derived from data provided by licencees for Diners Club branded cards issued outside of North America and is subject to subsequent revision or amendment  | <sup>1</sup> Volume is derived from data provided by licencees for Diners Club branded cards issued outside of North America and is subject to subsequent revision or amendment  | <sup>1</sup> Volume is derived from data provided by licencees for Diners Club branded cards issued outside of North America and is subject to subsequent revision or amendment  | <sup>1</sup> Volume is derived from data provided by licencees for Diners Club branded cards issued outside of North America and is subject to subsequent revision or amendment  | <sup>1</sup> Volume is derived from data provided by licencees for Diners Club branded cards issued outside of North America and is subject to subsequent revision or amendment  | <sup>1</sup> Volume is derived from data provided by licencees for Diners Club branded cards issued outside of North America and is subject to subsequent revision or amendment  | <sup>1</sup> Volume is derived from data provided by licencees for Diners Club branded cards issued outside of North America and is subject to subsequent revision or amendment  | <sup>1</sup> Volume is derived from data provided by licencees for Diners Club branded cards issued outside of North America and is subject to subsequent revision or amendment  | <sup>1</sup> Volume is derived from data provided by licencees for Diners Club branded cards issued outside of North America and is subject to subsequent revision or amendment  | <sup>1</sup> Volume is derived from data provided by licencees for Diners Club branded cards issued outside of North America and is subject to subsequent revision or amendment  | <sup>1</sup> Volume is derived from data provided by licencees for Diners Club branded cards issued outside of North America and is subject to subsequent revision or amendment  |
| Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms |  |  |  |  |  |  |  |  |

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|:---|:---|
| **DISCOVER FINANCIAL SERVICES - GLOSSARY OF FINANCIAL TERMS** | **DISCOVER FINANCIAL SERVICES - GLOSSARY OF FINANCIAL TERMS** |
| **<u>Balance Sheet & Regulatory Capital Terms</u>** | **<u>Balance Sheet & Regulatory Capital Terms</u>** |
| **Liquidity Portfolio** represents cash and cash equivalents (excluding cash-in-process) and other investments | **Liquidity Portfolio** represents cash and cash equivalents (excluding cash-in-process) and other investments |
| **Regulatory Capital Ratios** are preliminary | **Regulatory Capital Ratios** are preliminary |
| • | **Total Risk Based Capital Ratio** represents total capital divided by risk-weighted assets |
| • | **Tier 1 Capital Ratio** represents tier 1 capital divided by risk-weighted assets |
| • | **Tier 1 Leverage Ratio** represents tier 1 capital divided by average total assets |
| • | **Common Equity Tier 1 Capital Ratio** represents common equity tier 1 capital divided by risk weighted assets |
| **Tangible Assets** represents total assets less goodwill and intangibles | **Tangible Assets** represents total assets less goodwill and intangibles |
| **Tangible Common Equity ("TCE")**, a non-GAAP financial measure, represents total common equity less goodwill and intangibles. The Company believes TCE is a meaningful measure to investors of the net asset value of the Company. For corresponding reconciliation of TCE to a GAAP financial measure, see Reconciliation of GAAP to Non-GAAP Data  | **Tangible Common Equity ("TCE")**, a non-GAAP financial measure, represents total common equity less goodwill and intangibles. The Company believes TCE is a meaningful measure to investors of the net asset value of the Company. For corresponding reconciliation of TCE to a GAAP financial measure, see Reconciliation of GAAP to Non-GAAP Data  |
| **Tangible Common Equity/Net Loans**, a non-GAAP measure, represents TCE divided by total loans less the allowance for credit losses (period end) | **Tangible Common Equity/Net Loans**, a non-GAAP measure, represents TCE divided by total loans less the allowance for credit losses (period end) |
| **Tangible Common Equity per Share**, a non-GAAP measure, represents TCE divided by ending common shares outstanding | **Tangible Common Equity per Share**, a non-GAAP measure, represents TCE divided by ending common shares outstanding |
| **Tangible Common Equity/Tangible Assets**, a non-GAAP measure, represents TCE divided by total assets less goodwill and intangibles | **Tangible Common Equity/Tangible Assets**, a non-GAAP measure, represents TCE divided by total assets less goodwill and intangibles |
| **Undrawn Credit Facilities** represents asset-backed conduit funding facilities and Federal Reserve discount window (excluding investments pledged to the Federal Reserve, which are included within the liquidity investment portfolio) | **Undrawn Credit Facilities** represents asset-backed conduit funding facilities and Federal Reserve discount window (excluding investments pledged to the Federal Reserve, which are included within the liquidity investment portfolio) |
| **<u>Credit Related Terms</u>** | **<u>Credit Related Terms</u>** |
| **Delinquency Rate (30 or more days)** represents loans delinquent thirty days or more divided by ending loans (total or respective product loans, as appropriate) | **Delinquency Rate (30 or more days)** represents loans delinquent thirty days or more divided by ending loans (total or respective product loans, as appropriate) |
| **Delinquency Rate (90 or more days)** represents loans delinquent ninety days or more divided by ending loans (total or respective product loans, as appropriate) | **Delinquency Rate (90 or more days)** represents loans delinquent ninety days or more divided by ending loans (total or respective product loans, as appropriate) |
| **Gross Principal Charge-off Rate** represents gross principal charge-off dollars (annualized) divided by average loans for the reporting period (total or respective product loans, as appropriate) | **Gross Principal Charge-off Rate** represents gross principal charge-off dollars (annualized) divided by average loans for the reporting period (total or respective product loans, as appropriate) |
| **Net Principal Charge-off Rate** represents net principal charge-off dollars (annualized) divided by average loans for the reporting period (total or respective product loans, as appropriate) | **Net Principal Charge-off Rate** represents net principal charge-off dollars (annualized) divided by average loans for the reporting period (total or respective product loans, as appropriate) |
| **Reserve Rate** represents the allowance for credit losses divided by total loans (total or respective product loans, as appropriate) | **Reserve Rate** represents the allowance for credit losses divided by total loans (total or respective product loans, as appropriate) |
| **<u>Earnings and Shareholder Return Terms</u>** | **<u>Earnings and Shareholder Return Terms</u>** |
| **Book Value per share** represents total equity divided by ending common shares outstanding | **Book Value per share** represents total equity divided by ending common shares outstanding |
| **Capital Returned to Common Stockholders** represents common stock dividends declared and treasury share repurchases, excluding common stock issued under employee benefit plans and stock based compensation | **Capital Returned to Common Stockholders** represents common stock dividends declared and treasury share repurchases, excluding common stock issued under employee benefit plans and stock based compensation |
| **Earnings Per Share** represents net income allocated to common stockholders divided by the weighted average common shares outstanding | **Earnings Per Share** represents net income allocated to common stockholders divided by the weighted average common shares outstanding |
| **Interest Yield** represents interest income on loan receivables (annualized) divided by average loans for the reporting period (total or respective product loans, as appropriate) | **Interest Yield** represents interest income on loan receivables (annualized) divided by average loans for the reporting period (total or respective product loans, as appropriate) |
| **Net Income Allocated to Common Stockholders** represents net income less preferred stock dividends and income allocated to participating securities | **Net Income Allocated to Common Stockholders** represents net income less preferred stock dividends and income allocated to participating securities |
| **Net Interest Margin** represents net interest income (annualized) divided by average total loans for the period | **Net Interest Margin** represents net interest income (annualized) divided by average total loans for the period |
| **Net Yield on Interest Earning Assets** represents net interest income (annualized) divided by average total interest earning assets for the period | **Net Yield on Interest Earning Assets** represents net interest income (annualized) divided by average total interest earning assets for the period |
| **Operating Efficiency** represents total operating expense divided by revenue net of interest expense | **Operating Efficiency** represents total operating expense divided by revenue net of interest expense |
| **Pretax Return on Loan Receivables** represents income before income taxes (annualized) divided by total average loans for the period | **Pretax Return on Loan Receivables** represents income before income taxes (annualized) divided by total average loans for the period |
| **Payout Ratio** represents capital returned to common stockholders divided by net income allocated to common stockholders | **Payout Ratio** represents capital returned to common stockholders divided by net income allocated to common stockholders |
| **Return on Equity** represents net income (annualized) divided by average total equity for the reporting period | **Return on Equity** represents net income (annualized) divided by average total equity for the reporting period |
| **Rewards Rate** represents Credit Card rewards cost divided by Discover Card sales volume  | **Rewards Rate** represents Credit Card rewards cost divided by Discover Card sales volume  |
| **<u>Volume Terms</u>** | **<u>Volume Terms</u>** |
| **Discover Card Sales Volume** represents Discover card activity related to sales net of returns | **Discover Card Sales Volume** represents Discover card activity related to sales net of returns |
| **Discover Card Volume** represents Discover card activity related to sales net of returns, balance transfers, cash advances and other activity | **Discover Card Volume** represents Discover card activity related to sales net of returns, balance transfers, cash advances and other activity |
| **Discover Network Proprietary Volume** represents gross Discover Card sales volume on the Discover Network | **Discover Network Proprietary Volume** represents gross Discover Card sales volume on the Discover Network |

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|:---|:---|:---|:---|:---|:---|
| **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** | **DISCOVER FINANCIAL SERVICES** |
| **RECONCILIATION OF GAAP TO NON-GAAP DATA** | **RECONCILIATION OF GAAP TO NON-GAAP DATA** | **RECONCILIATION OF GAAP TO NON-GAAP DATA** | **RECONCILIATION OF GAAP TO NON-GAAP DATA** | **RECONCILIATION OF GAAP TO NON-GAAP DATA** | **RECONCILIATION OF GAAP TO NON-GAAP DATA** |
| **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** | **(unaudited, in millions)** |
| | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** | **Quarter Ended** |
| | **Dec 31, 2022** | **Sep 30, 2022** | **Jun 30, 2022** | **Mar 31, 2022** | **Dec 31, 2021** |
| GAAP Total Common Equity | $13534 | $13230 | $12708 | $12377 | $12352 |
| &nbsp;&nbsp;&nbsp;&nbsp;Less: Goodwill | (255) | (255) | (255) | (255) | (255) |
| &nbsp;&nbsp;&nbsp;&nbsp;Less: Intangibles |  |  |  |  |  |
| Tangible Common Equity <sup>1</sup> | $13279 | $12975 | $12453 | $12122 | $12097 |
| GAAP Book Value Per Share | $54.57 | $52.29 | $50.00 | $47.81 | $46.50 |
| &nbsp;&nbsp;&nbsp;&nbsp;Less: Goodwill | (0.96) | (0.94) | (0.92) | (0.91) | (0.88) |
| &nbsp;&nbsp;&nbsp;&nbsp;Less: Intangibles |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Less: Preferred Stock | (3.95) | (3.86) | (3.84) | (3.76) | (3.66) |
| Tangible Common Equity Per Share | $49.66 | $47.49 | $45.24 | $43.14 | $41.96 |
| <sup>1</sup> Tangible Common Equity ("TCE"), a non-GAAP financial measure, represents common equity less goodwill and intangibles. A reconciliation of TCE to common equity, a GAAP financial measure, is shown above. Other financial services companies may also use TCE and definitions may vary, so users of this information are advised to exercise caution in comparing TCE of different companies. TCE is included because management believes that common equity excluding goodwill and intangibles is a more meaningful measure to investors of the true net asset value of the Company | <sup>1</sup> Tangible Common Equity ("TCE"), a non-GAAP financial measure, represents common equity less goodwill and intangibles. A reconciliation of TCE to common equity, a GAAP financial measure, is shown above. Other financial services companies may also use TCE and definitions may vary, so users of this information are advised to exercise caution in comparing TCE of different companies. TCE is included because management believes that common equity excluding goodwill and intangibles is a more meaningful measure to investors of the true net asset value of the Company | <sup>1</sup> Tangible Common Equity ("TCE"), a non-GAAP financial measure, represents common equity less goodwill and intangibles. A reconciliation of TCE to common equity, a GAAP financial measure, is shown above. Other financial services companies may also use TCE and definitions may vary, so users of this information are advised to exercise caution in comparing TCE of different companies. TCE is included because management believes that common equity excluding goodwill and intangibles is a more meaningful measure to investors of the true net asset value of the Company | <sup>1</sup> Tangible Common Equity ("TCE"), a non-GAAP financial measure, represents common equity less goodwill and intangibles. A reconciliation of TCE to common equity, a GAAP financial measure, is shown above. Other financial services companies may also use TCE and definitions may vary, so users of this information are advised to exercise caution in comparing TCE of different companies. TCE is included because management believes that common equity excluding goodwill and intangibles is a more meaningful measure to investors of the true net asset value of the Company | <sup>1</sup> Tangible Common Equity ("TCE"), a non-GAAP financial measure, represents common equity less goodwill and intangibles. A reconciliation of TCE to common equity, a GAAP financial measure, is shown above. Other financial services companies may also use TCE and definitions may vary, so users of this information are advised to exercise caution in comparing TCE of different companies. TCE is included because management believes that common equity excluding goodwill and intangibles is a more meaningful measure to investors of the true net asset value of the Company | <sup>1</sup> Tangible Common Equity ("TCE"), a non-GAAP financial measure, represents common equity less goodwill and intangibles. A reconciliation of TCE to common equity, a GAAP financial measure, is shown above. Other financial services companies may also use TCE and definitions may vary, so users of this information are advised to exercise caution in comparing TCE of different companies. TCE is included because management believes that common equity excluding goodwill and intangibles is a more meaningful measure to investors of the true net asset value of the Company |
| Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms | Note: See Glossary of Financial Terms for definitions of financial terms |

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## Exhibit 99.3

![](a4q22earningspresentatio001.jpg)©2023 DISCOVER FINANCIAL SERVICES Exhibit 99.3 2022 & 4Q22 Financial Results January 18, 2023

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The following slides are part of a presentation by Discover Financial Services (the "Company") in connection with reporting quarterly financial results and are intended to be viewed as part of that presentation. No representation is made that the information in these slides is complete. For additional financial, statistical, and business related information, as well as information regarding business and segment trends, see the earnings release and financial supplement included as exhibits to the Company's Current Report on Form 8-K filed today and available on the Company's website (www.discover.com) and the SEC's website (www.sec.gov). The presentation contains forward-looking statements. You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they are made, which reflect management's estimates, projections, expectations or beliefs at that time, and which are subject to risks and uncertainties that may cause actual results to differ materially. For a discussion of certain risks and uncertainties that may affect the future results of the Company, please see "Special Note Regarding Forward-Looking Statements," "Risk Factors," "Business – Competition," "Business – Supervision and Regulation" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's Annual Report on Form 10-K for the year ended December 31, 2021, "Risk Factors" and "Management's Discussion & Analysis of Financial Condition and Results of Operations" in the company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2022, June 30, 2022 and March 31, 2022, which is filed with the SEC and available at the SEC's website (www.sec.gov) and subsequent reports on Forms 8-K and 10-Q, including the Company's Current Report on Form 8-K filed today with the SEC. The Company does not undertake to update or revise forward-looking statements as more information becomes available. Notice 2

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![](a4q22earningspresentatio003.jpg)

Full Year 2022 Highlights 3 • 2022 net income of $4.4Bn; diluted EPS of $15.50; and return on equity of 31% ◦ 4Q22 net income of $1.0Bn; diluted EPS of $3.77; and return on equity of 28% • Disciplined execution drove strong 2022 results amid fluid operating conditions ◦ Card account growth of 23% and elevated sales drove loan growth of 20% YOY ◦ Generated 39% efficiency ratio and 31% ROE ◦ Credit metrics are seasoning consistent with recent periods of elevated growth ◦ Repurchased $2.4Bn in common stock and increased common dividend by 22% • Remain well positioned to generate resilient returns through a range of economic environments ◦ Focus on prime lending with through-the-cycle approach to underwriting ◦ Disciplined expense management with prudent investments for growth ◦ Integrated digital banking and payments model generates high returns and enables capital return to shareholders

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![](a4q22earningspresentatio004.jpg)

• Revenue net of interest expense was $3.7Bn, up 27%, due to higher net interest income and prior year losses on equity investments • Net interest margin was 11.27%, up 46 bps primarily driven by higher market rates, partially offset by higher funding costs • Provision for credit losses increased by $620MM reflecting a $313MM reserve build in the current year compared to a $39MM release in the prior year and a $268MM increase in net charge-offs • Expenses increased $183MM, or 14%, due to higher employee compensation, marketing, professional fees, and a one-time facility write-off 4Q22 Summary Financial Results Key Points 4 $1,067 $584 $212 $(620) $(183) $(27) $1,033 4Q21 Net Income Net Interest Income Non- Interest Income Provision for Credit Losses Operating Expense Income Tax/ Capital Action 4Q22 Net Income Year-Over-Year Net Income & EPS ($MM, except EPS) 4Q22 $3,067 $665 $883 $1,495 $321 4Q21 $2,483 $453 $263 $1,312 $294 B/(W) $584 $212 $(620) $(183) $(27) EPS $3.64 $1.57 $0.57 $(1.66) $(0.49) $0.15 $3.77

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![](a4q22earningspresentatio005.jpg)

• NIM on loans was 11.27%, up 22bps QOQ as favorable loan and securities yields were partially offset by higher funding costs • Total loan yield was up 86bps QOQ primarily due to higher prime rate • The rate on average interest- bearing liabilities increased 87bps QOQ, reflecting increased consumer deposit pricing • Consumer deposits were up 5% QOQ; we continue to target 70-80% deposit funding 4Q22 Net Interest Income Drivers 5 Key Points Note(s) 1. DTC and Affinity Deposits include checking and reflect both interest-bearing and non-interest bearing consumer deposits 10.81% 10.85% 10.94% 11.05% 11.27% 4Q21 1Q22 2Q22 3Q22 4Q22 NIM on Loans Loan Growth ($Bn) Funding Mix (%), Average Balance (1) Total Loans +20% YOY $74.4 $73.8 $79.2 $83.6 $90.1 $9.4 $9.6 $9.4 $9.7 $9.7 $6.9 $6.9 $7.1 $7.7 $8.0 $3.0 $3.2 $3.5 $3.9 $4.3 Card +21% YOY Organic Student +4% YOY Personal +15% YOY Other + 43% YOY 4Q21 1Q22 2Q22 3Q22 4Q22 68% 71% 70% 65% 64% 11% 11% 11% 15% 18% 10% 7% 9% 10% 9% 11% 11% 10% 10% 9% DTC and Affinity Deposits Brokered & Other Deposits Securitized Borrowing Unsecured Borrowing 4Q21 1Q22 2Q22 3Q22 4Q22 Total Loan Yield 11.75% 11.80% 12.00% 12.67% 13.53% Total Int. - Bearing Liab Rate 1.15% 1.18% 1.36% 2.09% 2.96% Consumer Deposits +10% YOY

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![](a4q22earningspresentatio006.jpg)

Note(s) 1. Rewards rate represents credit card rewards cost divided by Discover Card sales volume • Net interest income increased primarily due to higher loan receivables and margin expansion • Net discount and interchange revenue was driven by higher sales volume partially offset by increased rewards costs • Loan fee income increased primarily reflecting higher late fees • The FY22 rewards rate was 1.41%, up 4bps YOY 4Q22 Revenue 6 Key Points Inc / (Dec) ($MM) 4Q22 4Q21 $% Net Interest Income 3,067 2,483 584 24% Net Discount/Interchange Revenue 368 345 23 7% Protection Products Revenue 44 36 8 22% Loan Fee Income 182 131 51 39% Transaction Processing Revenue 66 60 6 10% Gain/(Loss) on Equity Investment (6) (138) 132 96% Other Income 11 19 (8) (42%) Total Non-Interest Income 665 453 212 47% Revenue Net of Interest Expense $3,732 $2,936 $796 27% Change 4Q22 4Q21 QOQ YOY Discover Card Sales Volume ($MM) $55,663 $51,308 2 % 8% Rewards Rate (1) 1.42 % 1.35 % -5bps 7bps $2,936 $584 $23 $8 $51 $6 132 $(8) $3,732 4Q21 Rev Net of Int Exp Net Interest Income Net Discount/ Interchange Protection Products Loan Fee Income Transaction Processing Gain/ (Loss) on Equity Investments Other Income 4Q22 Rev Net of Int Exp Year-Over-Year Revenue ($MM)

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Note(s) 1. Defined as reported total operating expense divided by revenue net of interest expense • Employee compensation increased due to higher headcount and wage inflation • Marketing was up primarily due to investments in brand and acquisition • Professional fees increased due to investment in technology and consulting costs • Premises and equipment increased due to one-time facility write-off as we continue to optimize our real estate footprint 4Q22 Operating Expense Inc / (Dec) ($MM) 4Q22 4Q21 $% Employee Compensation and Benefits $573 $499 74 15% Marketing and Business Development 313 271 42 15% Information Processing & Communications 143 125 18 14% Professional Fees 264 230 34 15% Premises and Equipment 48 23 25 109% Other Expense 154 164 (10) (6%) Total Operating Expense $1,495 $1,312 $183 14% Operating Efficiency(1) 40.0 % 44.7 % (470) bps 7 Key Points Year-Over-Year Expense ($MM) $1,312 $74 $42 $18 $34 $15 $1,495 4Q21 Expense Employee Comp Marketing Info Processing Professional Fees All Other 4Q22 Expense

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![](a4q22earningspresentatio008.jpg)

• Seasoning occurring across most products and credit segments • Higher credit card net charge- off rate driven by an increase in early stage delinquencies • Student loan net charge-offs largely reflect the expiration of pandemic assistance programs • Personal loan net charge-offs remain well below pre- pandemic norms 4Q22 Key Credit Metrics 8 Key PointsChange 4Q21 3Q22 4Q22 QOQ YOY Credit Card Loans Ending Loan Balance ($MM) $74,369 $83,630 $90,113 7.8% 21.2% Net Principal Charge-off Rate 1.50% 1.92% 2.37% 45 bps 87 bps 30-Day Delinquency Rate 1.66% 2.11% 2.53% 42 bps 87 bps Private Student Loans Ending Loan Balance ($MM) $10,113 $10,349 $10,308 (0.4)% 1.9% Net Principal Charge-off Rate 0.80% 0.91% 1.33% 42 bps 53 bps 30-Day Delinquency Rate 1.55% 1.94% 2.05% 11 bps 50 bps Personal Loans Ending Loan Balance ($MM) $6,936 $7,674 $7,998 4.2% 15.3% Net Principal Charge-off Rate 1.21% 1.14% 1.49% 35 bps 28 bps 30-Day Delinquency Rate 0.69% 0.69% 0.80% 11 bps 11 bps Total Loans Ending Loan Balance ($MM) $93,684 $104,908 $112,120 6.9% 19.7% Net Principal Charge-off Rate 1.37% 1.71% 2.13% 42 bps 76 bps 30-Day Delinquency Rate 1.55% 1.94% 2.30% 36 bps 75 bps

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![](a4q22earningspresentatio009.jpg)

9 ($MM) Credit Card Student Loans Personal Loans Other Total Loans Balance at December 31, 2021 $5,273 $843 $662 $44 $6,822 Reserve rate 7.09% 8.33% 9.54% N/A 7.28% Balance at September 30, 2022 $5,561 $829 $620 $51 $7,061 Reserve rate 6.65% 8.01% 8.08% N/A 6.73% Provision for credit losses 838 45 5 6 894 Net Charge-offs 516 35 30 — 581 Balance at December 31, 2022 $5,883 $839 $595 $57 $7,374 Reserve rate 6.53% 8.14% 7.44% N/A 6.58% Total Loan Reserve Rate 7.28% 7.11% 6.80% 6.73% 6.58% 4Q21 1Q22 2Q22 3Q22 4Q22 Allowance for Credit Losses

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![](a4q22earningspresentatio010.jpg)

10 Capital Return(3)Capital Position Common Equity Tier 1 (CET1) Capital Ratio(1) (%) TTM Payout Ratio(2) (%) Note(s) 1. Based on the final rule published September 30, 2020. Capital ratios reflect delay in the recognition of the impact of CECL reserves on regulatory capital for two years in accordance with the final rule 2. Payout Ratio is displayed on a trailing twelve month basis. This represents the trailing twelve months' Capital Return to Common Stockholders divided by the trailing twelve months' Net Income Allocated to Common Stockholders 3. Quarterly dividend per share figures for 2017 through 2022 represent year-end levels 11.6% 11.1% 11.2% 13.1% 14.8% 13.3% 123% 93% 77% 76% 51% 67% 2017 2018 2019 2020 2021 2022 • The Common Equity Tier 1 ratio of 13.3% remains above our target of 10.5% • Resumed share repurchase program and bought $602 million in the quarter Key Points $2.1 $2.1 $1.8 $0.3 $2.3 $2.4 $0.35 $0.40 $0.44 $0.44 $0.50 $0.60 2017 2018 2019 2020 2021 2022 Capital Position & Capital Return Trends Share Repurchases ($Bn) Quarterly Dividend per Share

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11 2022 Perspective 2022 Actual 2023 Perspective Loan Growth 20% • Expect loan growth to be low double digits Net Interest Margin 11.04% • Expect NIM to be modestly higher vs. full year 2022 Operating Expense $5.2Bn • Expect total operating expense to be up less than 10% from prior year Net Charge-offs 1.82% • Expect full year average net charge-off rate of 3.5-3.9% Capital Management $2.9Bn returned to shareholders • $2.8Bn remains under the current share repurchase plan authorization that expires June 30, 2023

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![](a4q22earningspresentatio012.jpg)

Appendix

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![](a4q22earningspresentatio013.jpg)

4Q22 Asset Yield & Liabilities Rate 4Q22 3Q22 4Q21 Interest-Earning Assets ($Bn) Avg Bal Yield Avg Bal Yield Avg Bal Yield Total Loans $108.0 13.53 % $102.0 12.67 % $91.1 11.75 % Other Interest-Earning Assets 20.0 3.42 % 16.9 2.30 % 18.5 0.95 % Total Interest-Earning Assets $128.0 11.96 % $118.9 11.20 % $109.6 9.93 % 4Q22 3Q22 4Q21 Interest-Bearing Liabilities ($Bn) Avg Bal Rate Avg Bal Rate Avg Bal Rate Direct to Consumer Deposits (1) (2) $66.9 2.55 % $63.4 1.53 % $60.8 0.58 % Brokered Deposits and Other 19.2 3.50 % 14.7 2.71 % 9.8 2.16 % Interest Bearing-Deposits 86.1 2.76 % 78.1 1.76 % 70.7 0.80 % Borrowings 19.5 3.84 % 19.4 3.45 % 18.8 2.46 % Total Interest-Bearing Liabilities $105.6 2.96 % $97.5 2.09 % $89.5 1.15 % 13 Note(s) 1. Includes Affinity relationships 2. Excludes checking which is a non-interest bearing deposit product

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![](a4q22earningspresentatio014.jpg)

Total Company Loans Credit Card Loans Private Student Loans Personal Loans 3.00 2.38 2.48 2.12 1.46 1.37 1.61 1.80 1.71 2.13 1.77 1.89 1.67 1.34 1.40 1.55 1.64 1.63 1.94 2.30 NCO rate (%) 30+ day DQ rate (%) 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 3.45 2.63 2.80 2.45 1.65 1.50 1.84 2.01 1.92 2.37 1.91 2.07 1.85 1.43 1.48 1.66 1.77 1.76 2.11 2.53 NCO rate (%) 30+ day DQ rate (%) 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 2.69 2.79 2.80 1.80 1.11 1.21 1.12 1.21 1.14 1.49 1.10 1.08 0.84 0.69 0.71 0.69 0.69 0.63 0.69 0.80 NCO rate (%) 30+ day DQ rate (%) 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 0.58 0.71 0.53 0.53 0.68 0.80 0.69 1.08 0.91 1.33 1.49 1.39 1.20 1.34 1.55 1.55 1.62 1.66 1.94 2.05 NCO rate (%) 30+ day DQ rate (%) 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 Credit Performance Trends 14

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![](a4q22earningspresentatio015.jpg)

YOY YOY YOY YOY 4Q22 Payments Volume ($Bn) Discover Network • Discover Network volume was up 9% reflecting the increase in Discover card sales volume • PULSE volume was up 3% driven by debit transaction volume • Diners volume was up 24% from the prior year reflecting improvement in global T&E and corporate spending • Network Partners was down 7% YOY driven by lower transaction volume Key Points $53.2 $48.1 $55.8 $56.6 $58.1 4Q21 1Q22 2Q22 3Q22 4Q22 $64.8 $59.8 $63.0 $63.4 $66.8 4Q21 1Q22 2Q22 3Q22 4Q22 $7.4 $7.2 $8.4 $8.8 $9.2 4Q21 1Q22 2Q22 3Q22 4Q22 $11.2 $10.7 $11.5 $11.9 $10.4 4Q21 1Q22 2Q22 3Q22 4Q22 Diners (1) PULSE Network Partners 9% 3% 24% (7%) Note(s) 1. Volume is derived from data provided by licensees for Diners Club branded cards issued outside of North America and is subject to subsequent revision or amendment Total Network Volume up 6% YOY 15

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