Discover Financial Services 8K Net Income of $432 Million and Earnings Per Share of $0.89 | DFS 18 Dec 08

Exhibit 99.2

Discover Financial Services
GAAP Basis
(unaudited, dollars in thousands, except per
share statistics)	Quarter Ended															Nov 30, 2008						Year Ended
	Nov 30, 2008			Aug 31, 2008			May 31, 2008			Feb 29, 2008			Nov 30, 2007			vs Nov 30, 2007						Nov 30, 2008			Nov 30, 2007			2008 vs 2007

Earnings Summary
Interest Income	$	736,006		$	681,692		$	612,063		$	662,802		$	659,676		$	76,330			12	%	$	2,692,563		$	2,584,402		$	108,161			4	%
Interest Expense		329,672			305,643			313,248			339,441			350,917			(21,245	)		(6	%)		1,288,004			1,223,270			64,734			5	%
Net Interest Income		406,334			376,049			298,815			323,361			308,759			97,575			32	%		1,404,559			1,361,132			43,427			3	%
Other Income 1		1,568,901			875,121			844,892			975,544			952,500			616,401			65	%		4,264,458			3,376,682			887,776			26	%
Revenue Net of Interest Expense		1,975,235			1,251,170			1,143,707			1,298,905			1,261,259			713,976			57	%		5,669,017			4,737,814			931,203			20	%
Provision for Loan Losses		714,176			364,838			210,969			305,632			296,186			417,990			141	%		1,595,615			733,887			861,728			117	%
Employee Compensation and Benefits		187,306			222,426			218,290			217,370			208,910			(21,604	)		(10	%)		845,392			850,065			(4,673	)		(1	%)
Marketing and Business Development		119,382			137,928			132,038			141,553			155,976			(36,594	)		(23	%)		530,901			576,263			(45,362	)		(8	%)
Information Processing & Communications		81,543			76,675			79,449			78,276			85,034			(3,491	)		(4	%)		315,943			330,053			(14,110	)		(4	%)
Professional Fees		111,645			82,775			81,392			73,672			94,380			17,265			18	%		349,484			361,409			(11,925	)		(3	%)
Premises and Equipment		20,676			20,274			19,803			19,641			19,348			1,328			7	%		80,394			79,442			952			1	%
Other Expense		73,530			72,469			75,853			71,831			73,083			447			1	%		293,683			280,982			12,701			5	%
Total Other Expense		594,082			612,547			606,825			602,343			636,731			(42,649	)		(7	%)		2,415,797			2,478,214			(62,417	)		(3	%)
Income (Loss) Before Income Taxes 1		666,977			273,785			325,913			390,930			328,342			338,635			103	%		1,657,605			1,525,713			131,892			9	%
Tax Expense		223,336			94,885			124,370			152,101			118,368			104,968			89	%		594,692			561,514			33,178			6	%
Income From Continuing Operations 1		443,641			178,900			201,543			238,829			209,974			233,667			111	%		1,062,913			964,199			98,714			10	%
Discontinued Operations, Net of Tax 2, 3		(11,306	)		1,153			32,605			(157,615	)		(266,458	)		255,152			96	%		(135,163	)		(375,569	)		240,406			64	%
Net Income (Loss) 1, 2, 3	$	432,335		$	180,053		$	234,148		$	81,214		$	(56,484	)	$	488,819		NM			$	927,750		$	588,630		$	339,120			58	%

Effective Tax Rate From Continuing Operations		33.5	%		34.7	%		38.2	%		38.9	%		36.1	%								35.9	%		36.8	%

Balance Sheet Statistics 4
Total Assets	$	39,892,382		$	37,283,548		$	34,020,245		$	34,222,732		$	33,449,702		$	6,442,680			19	%	$	39,892,382		$	33,449,702		$	6,442,680			19	%
Total Equity	$	5,924,044		$	6,000,393		$	5,849,691		$	5,654,341		$	5,599,422		$	324,622			6	%	$	5,924,044		$	5,599,422		$	324,622			6	%
Total Tangible Equity	$	5,465,304		$	5,539,274		$	5,538,240		$	5,341,020		$	5,284,232		$	181,072			3	%	$	5,465,304		$	5,284,232		$	181,072			3	%
Tangible Equity/Total Owned Assets		13.7	%		14.9	%		16.3	%		15.6	%		15.8	%								13.7	%		15.8	%
ROE 1, 2, 3		29	%		12	%		16	%		6	%		(4	%)								16	%		10	%
ROE from Continuing Operations 1		30	%		12	%		14	%		17	%		15	%								18	%		17	%

Allowance for Loan Loss (period end)	$	1,374,585		$	959,769		$	846,775		$	860,378		$	759,925		$	614,660			81	%	$	1,374,585		$	759,925		$	614,660			81	%
Change in Loan Loss Reserves	$	414,816		$	112,994		$	(13,603	)	$	100,453		$	130,467		$	284,349		NM			$	614,660		$	56,009		$	558,651		NM
Reserve Rate		5.45	%		4.41	%		4.28	%		4.16	%		3.65	%		180		bps				5.45	%		3.65	%		180		bps
Interest-only Strip Receivable (period end)	$	300,120		$	408,649		$	447,994		$	468,059		$	400,313		$	(100,193	)		(25	%)	$	300,120		$	400,313		$	(100,193	)		(25	%)
Net Revaluation of Retained Interests	$	(116,335	)	$	(33,513	)	$	(44,473	)	$	74,997		$	37,475		$	(153,810	)	NM			$	(119,324	)	$	51,346		$	(170,670	)	NM

Per Share Statistics
Basic EPS 1, 2, 3	$	0.90		$	0.38		$	0.49		$	0.17		$	(0.12	)	$	1.02		NM			$	1.94		$	1.23		$	0.71			58	%
Basic EPS from Continuing Operations 1	$	0.92		$	0.38		$	0.42		$	0.50		$	0.44		$	0.48			109	%	$	2.22		$	2.02		$	0.20			10	%
Diluted EPS 1, 2, 3	$	0.89		$	0.37		$	0.48		$	0.17		$	(0.12	)	$	1.01		NM			$	1.92		$	1.23		$	0.69			56	%
Diluted EPS from Continuing Operations 1	$	0.92		$	0.37		$	0.42		$	0.50		$	0.44		$	0.48			109	%	$	2.20		$	2.01		$	0.19			9	%
Stock Price (period end)	$	10.23		$	16.45		$	17.15		$	15.09		$	17.37		$	(7.14	)		(41	%)	$	10.23		$	17.37		$	(7.14	)		(41	%)
Book Value	$	12.34		$	12.51		$	12.20		$	11.80		$	11.72		$	0.62			5	%	$	12.34		$	11.72		$	0.62			5	%
Ending Shares Outstanding (000's)		479,987			479,764			479,346			479,127			477,688			2,299			0	%		479,987			477,688			2,299			0	%
Weighted Average Shares Outstanding (000's)		479,931			479,618			479,270			478,518			477,567			2,364			0	%		479,335			477,328			2,007			0	%
Weighted Average Shares Outstanding (fully diluted) (000's)		484,558			484,128			483,753			481,744			477,567			6,991			1	%		483,470			478,879			4,591			1	%

Loan Receivables 4
Total Loans - Owned	$	25,216,611		$	21,767,483		$	20,502,063		$	21,042,681		$	20,831,117		$	4,385,494			21	%	$	25,216,611		$	20,831,117		$	4,385,494			21	%
Average Total Loans - Owned	$	22,945,494		$	21,053,804		$	19,890,330		$	21,523,606		$	19,405,775		$	3,539,719			18	%	$	21,348,493		$	19,947,784		$	1,400,709			7	%

Interest Yield		11.36	%		11.41	%		10.40	%		10.34	%		10.51	%		85		bps				10.89	%		10.73	%		16		bps
Net Principal Charge-off Rate		5.25	%		4.76	%		4.49	%		3.83	%		3.43	%		182		bps				4.59	%		3.40	%		119		bps
Delinquency Rate (over 30 days)		4.35	%		3.58	%		3.54	%		3.63	%		3.26	%		109		bps				4.35	%		3.26	%		109		bps
Delinquency Rate (over 90 days)		2.06	%		1.73	%		1.81	%		1.82	%		1.51	%		55		bps				2.06	%		1.51	%		55		bps

Transactions Processed on Networks (000's)
Discover Network		377,356			388,504			370,596			378,912			378,438			(1,082	)		(0	%)		1,515,368			1,486,366			29,002			2	%
PULSE Network		644,045			713,791			703,404			621,072			611,518			32,527			5	%		2,682,312			2,285,061			397,251			17	%
Total		1,021,401			1,102,295			1,074,000			999,984			989,956			31,445			3	%		4,197,680			3,771,427			426,253			11	%

Volume
PULSE Network	$	25,033,235		$	28,364,575		$	27,830,403		$	24,783,895		$	23,035,361		$	1,997,874			9	%	$	106,012,108		$	86,236,408		$	19,775,700			23	%
Third-Party Issuers		1,538,013			1,711,617			1,603,006			1,545,943			1,458,959			79,054			5	%		6,398,579			5,480,105			918,474			17	%
Diners Club International 5		7,467,235			5,227,795			-			-			-			7,467,235		NM				12,695,030			-			12,695,030		NM
Total Third-Party Payments		34,038,483			35,303,987			29,433,409			26,329,838			24,494,320			9,544,163			39	%		125,105,717			91,716,513			33,389,204			36	%
Discover Network - Proprietary 6		22,875,272			25,117,321			23,621,519			24,074,331			23,482,095			(606,823	)		(3	%)		95,688,443			93,794,500			1,893,943			2	%
Total	$	56,913,755		$	60,421,308		$	53,054,928		$	50,404,169		$	47,976,415		$	8,937,340			19	%	$	220,794,160		$	185,511,013		$	35,283,147			19	%

1 The quarter ended November 30, 2008 includes proceeds of $863 million pre-tax (estimated $535 million after-tax) related to the antitrust settlement.

2 The quarter ended May 31, 2008 includes income from discontinued operations, net of tax of $32.6 million consisting of a $21 million gain related to disposition of the Goldfish business and income of $12 million related to the Goldfish business operations. The quarter ended February 29, 2008 includes a loss from discontinued operations, net of tax of $158 million consisting of a $172 million loss related to reflecting the Goldfish business as held for sale and income of $14 million related to the Goldfish business operations.

3 The quarter ended November 30, 2007 includes a $391 million pre-tax ($279 million after-tax) non-cash impairment charge related to the company's Goldfish business.

4 Based on Continuing Operations except equity and ROE. Equity is based on company's equity.

5 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.

6 Gross proprietary sales volume on the Discover Network.

Discover Financial Services
Managed Basis 1
(unaudited, dollars in thousands)
	Quarter Ended															Nov 30, 2008						Year Ended
	Nov 30, 2008			Aug 31, 2008			May 31, 2008			Feb 29, 2008			Nov 30, 2007			vs Nov 30, 2007						Nov 30, 2008			Nov 30, 2007			2008 vs 2007

Earnings Summary
Interest Income	$	1,682,267		$	1,638,250		$	1,572,697		$	1,652,615		$	1,667,418		$	14,849			1	%	$	6,545,829		$	6,378,674		$	167,155			3	%
Interest Expense		602,450			534,887			550,629			668,953			750,638			(148,188	)		(20	%)		2,356,919			2,741,128			(384,209	)		(14	%)
Net Interest Income		1,079,817			1,103,363			1,022,068			983,662			916,780			163,037			18	%		4,188,910			3,637,546			551,364			15	%
Other Income 2		1,287,213			536,997			492,207			636,679			633,014			654,199			103	%		2,953,096			2,219,776			733,320			33	%
Revenue Net of Interest Expense		2,367,030			1,640,360			1,514,275			1,620,341			1,549,794			817,236			53	%		7,142,006			5,857,322			1,284,684			22	%
Provision for Loan Losses		1,105,971			754,028			581,537			627,068			584,721			521,250			89	%		3,068,604			1,853,395			1,215,209			66	%
Employee Compensation and Benefits		187,306			222,426			218,290			217,370			208,910			(21,604	)		(10	%)		845,392			850,065			(4,673	)		(1	%)
Marketing and Business Development		119,382			137,928			132,038			141,553			155,976			(36,594	)		(23	%)		530,901			576,263			(45,362	)		(8	%)
Information Processing & Communications		81,543			76,675			79,449			78,276			85,034			(3,491	)		(4	%)		315,943			330,053			(14,110	)		(4	%)
Professional Fees		111,645			82,775			81,392			73,672			94,380			17,265			18	%		349,484			361,409			(11,925	)		(3	%)
Premises and Equipment		20,676			20,274			19,803			19,641			19,348			1,328			7	%		80,394			79,442			952			1	%
Other Expense		73,530			72,469			75,853			71,831			73,083			447			1	%		293,683			280,982			12,701			5	%
Total Other Expense		594,082			612,547			606,825			602,343			636,731			(42,649	)		(7	%)		2,415,797			2,478,214			(62,417	)		(3	%)
Income (Loss) Before Income Taxes 2		666,977			273,785			325,913			390,930			328,342			338,635			103	%		1,657,605			1,525,713			131,892			9	%
Tax Expense		223,336			94,885			124,370			152,101			118,368			104,968			89	%		594,692			561,514			33,178			6	%
Income From Continuing Operations 2		443,641			178,900			201,543			238,829			209,974			233,667			111	%		1,062,913			964,199			98,714			10	%
Discontinued Operations, Net of Tax 2, 3, 4		(11,306	)		1,153			32,605			(157,615	)		(266,458	)		255,152			96	%		(135,163	)		(375,569	)		240,406			64	%
Net Income (Loss) 2, 3, 4	$	432,335		$	180,053		$	234,148		$	81,214		$	(56,484	)	$	488,819		NM			$	927,750		$	588,630		$	339,120			58	%

Balance Sheet Statistics 5
Total Assets	$	65,620,476		$	65,632,825		$	62,148,577		$	61,937,501		$	60,591,475		$	5,029,001			8	%	$	65,620,476		$	60,591,475		$	5,029,001			8	%
Total Equity 6	$	5,924,044		$	6,000,393		$	5,849,691		$	5,654,341		$	5,599,422		$	324,622			6	%	$	5,924,044		$	5,599,422		$	324,622			6	%
Total Tangible Equity 6	$	5,465,304		$	5,539,274		$	5,538,240		$	5,341,020		$	5,284,232		$	181,072			3	%	$	5,465,304		$	5,284,232		$	181,072			3	%
Tangible Equity/Net Managed Receivables		11.0	%		11.2	%		11.8	%		11.5	%		11.1	%								11.0	%		11.1	%
Tangible Equity/Total Managed Assets		8.3	%		8.4	%		8.9	%		8.6	%		8.7	%								8.3	%		8.7	%

Net Yield on Loan Receivables		8.56	%		8.95	%		8.57	%		8.10	%		7.76	%		80		bps				8.55	%		7.75	%		80		bps
Return on Loan Receivables 2		3.52	%		1.45	%		1.69	%		1.97	%		1.78	%		174		bps				2.17	%		2.06	%		11		bps

Loan Receivables 5
Total Loans - Managed	$	51,095,278		$	50,427,305		$	47,841,491		$	47,500,410		$	48,180,436		$	2,914,842			6	%	$	51,095,278		$	48,180,436		$	2,914,842			6	%
Average Total Loans - Managed	$	50,707,090		$	49,019,083		$	47,472,077		$	48,863,166		$	47,381,471		$	3,325,619			7	%	$	49,011,148		$	46,913,474		$	2,097,674			4	%

Managed Interest Yield		12.65	%		12.67	%		12.41	%		12.70	%		12.84	%		(19	)	bps				12.61	%		12.65	%		(4	)	bps
Managed Net Principal Charge-off Rate		5.48	%		5.20	%		4.99	%		4.33	%		3.85	%		163		bps				5.01	%		3.83	%		118		bps
Managed Delinquency Rate (over 30 days)		4.56	%		3.85	%		3.81	%		3.90	%		3.58	%		98		bps				4.56	%		3.58	%		98		bps
Managed Delinquency Rate (over 90 days)		2.17	%		1.88	%		1.96	%		1.96	%		1.67	%		50		bps				2.17	%		1.67	%		50		bps

Credit Card Volume	$	25,318,553		$	28,611,680		$	25,596,794		$	26,207,028		$	26,159,776		$	(841,223	)		(3	%)	$	105,734,055		$	106,620,818		$	(886,763	)		(1	%)
Credit Card Sales Volume	$	22,025,264		$	24,601,611		$	22,457,651		$	23,155,253		$	22,588,639		$	(563,375	)		(2	%)	$	92,239,779		$	90,262,556		$	1,977,223			2	%

Segment - Income Before Income Taxes
U.S. Card	$	646,427		$	245,241		$	309,123		$	375,403		$	320,751		$	325,676			102	%	$	1,576,194		$	1,488,753		$	87,441			6	%
Third-Party Payments		20,550			28,544			16,790			15,527			7,591			12,959			171	%		81,411			36,960			44,451			120	%
Total	$	666,977		$	273,785		$	325,913		$	390,930		$	328,342		$	338,635			103	%	$	1,657,605		$	1,525,713		$	131,892			9	%

1 Managed basis assumes loans that have been securitized were not sold and presents earnings and statistical information on these loans in a manner similar to the way loans that have not been sold are presented. See Reconciliation of GAAP to Managed Data schedule.

2 The quarter ended November 30, 2008 includes proceeds of $863 million pre-tax (estimated $535 million after-tax) related to the antitrust settlement.

3 The quarter ended May 31, 2008 includes income from discontinued operations, net of tax of $32.6 million consisting of a $21 million gain related to disposition of the Goldfish business and income of $12 million related to the Goldfish business operations. The quarter ended February 29, 2008 includes a loss from discontinued operations, net of tax of $158 million consisting of a $172 million loss related to reflecting the Goldfish business as held for sale and income of $14 million related to the Goldfish business operations.

4 The quarter ended November 30, 2007 includes a $391 million pre-tax ($279 million after-tax) non-cash impairment charge related to the company's Goldfish business.

5 Based on Continuing Operations. Equity is based on company's equity.

6 Balance on a GAAP and Managed basis is the same.

Discover Financial Services
U.S. Card Segment
Managed Basis1
(unaudited, dollars in thousands)
	Quarter Ended															Nov 30, 2008						Year Ended
	Nov 30, 2008			Aug 31, 2008			May 31, 2008			Feb 29, 2008			Nov 30, 2007			vs Nov 30, 2007						Nov 30, 2008			Nov 30, 2007			2008 vs 2007

Earnings Summary
Interest Income	$	1,680,925		$	1,637,588		$	1,572,164		$	1,651,987		$	1,666,768		$	14,157			1	%	$	6,542,664		$	6,376,298		$	166,366			3	%
Interest Expense		602,386			534,870			550,629			668,951			750,638			(148,252	)		(20	%)		2,356,836			2,741,109			(384,273	)		(14	%)
Net Interest Income		1,078,539			1,102,718			1,021,535			983,036			916,130			162,409			18	%		4,185,828			3,635,189			550,639			15	%
Other Income 2		1,234,100			482,311			455,074			602,411			603,709			630,391			104	%		2,773,896			2,101,076			672,820			32	%
Revenue Net of Interest Expense		2,312,639			1,585,029			1,476,609			1,585,447			1,519,839			792,800			52	%		6,959,724			5,736,265			1,223,459			21	%
Provision for Loan Losses		1,105,971			754,028			581,537			627,068			584,721			521,250			89	%		3,068,604			1,853,395			1,215,209			66	%
Total Other Expense		560,241			585,760			585,949			582,976			614,367			(54,126	)		(9	%)		2,314,926			2,394,117			(79,191	)		(3	%)
Income (Loss) Before Income Taxes 2	$	646,427		$	245,241		$	309,123		$	375,403		$	320,751		$	325,676			102	%	$	1,576,194		$	1,488,753		$	87,441			6	%

Net Yield on Loan Receivables		8.55	%		8.95	%		8.56	%		8.09	%		7.76	%		79		bps				8.54	%		7.75	%		79		bps
Pretax Return on Loan Receivables 2		5.13	%		1.99	%		2.59	%		3.09	%		2.72	%		241		bps				3.22	%		3.17	%		5		bps

Loan Receivables
Total Loans	$	51,095,278		$	50,427,305		$	47,841,491		$	47,500,410		$	48,180,436		$	2,914,842			6	%	$	51,095,278		$	48,180,436		$	2,914,842			6	%
Average Total Loans	$	50,707,090		$	49,019,083		$	47,472,077		$	48,863,166		$	47,381,471		$	3,325,619			7	%	$	49,011,148		$	46,913,474		$	2,097,674			4	%

Managed Interest Yield		12.65	%		12.67	%		12.41	%		12.70	%		12.84	%		(19	)	bps				12.61	%		12.65	%		(4	)	bps
Managed Net Principal Charge-off Rate		5.48	%		5.20	%		4.99	%		4.33	%		3.85	%		163		bps				5.01	%		3.83	%		118		bps
Managed Delinquency Rate (over 30 days)		4.56	%		3.85	%		3.81	%		3.90	%		3.58	%		98		bps				4.56	%		3.58	%		98		bps
Managed Delinquency Rate (over 90 days)		2.17	%		1.88	%		1.96	%		1.96	%		1.67	%		50		bps				2.17	%		1.67	%		50		bps

Credit Card Loans
Credit Card Loans - Managed	$	49,692,974		$	49,348,507		$	47,124,842		$	47,014,539		$	47,929,242		$	1,763,732			4	%	$	49,692,974		$	47,929,242		$	1,763,732			4	%
Average Credit Card Loans - Managed	$	49,420,412		$	48,168,124		$	46,857,480		$	48,487,812		$	47,251,899		$	2,168,513			5	%	$	48,229,519		$	46,811,570		$	1,417,949			3	%

Managed Interest Yield		12.72	%		12.70	%		12.43	%		12.72	%		12.85	%		(13	)	bps				12.65	%		12.66	%		(1	)	bps
Managed Net Principal Charge-off Rate		5.59	%		5.28	%		5.05	%		4.37	%		3.85	%		174		bps				5.07	%		3.84	%		123		bps
Managed Delinquency Rate (over 30 days)		4.66	%		3.92	%		3.85	%		3.93	%		3.59	%		107		bps				4.66	%		3.59	%		107		bps
Managed Delinquency Rate (over 90 days)		2.22	%		1.92	%		1.99	%		1.98	%		1.68	%		54		bps				2.22	%		1.68	%		54		bps

Total Credit Card Volume	$	25,318,553		$	28,611,680		$	25,596,794		$	26,207,028		$	26,159,776		$	(841,223	)		(3	%)	$	105,734,055		$	106,620,818		$	(886,763	)		(1	%)
Sales Volume	$	22,025,264		$	24,601,611		$	22,457,651		$	23,155,253		$	22,588,639		$	(563,375	)		(2	%)	$	92,239,779		$	90,262,556		$	1,977,223			2	%

2 The quarter ended November 30, 2008 includes proceeds of $863 million pre-tax related to the antitrust settlement.

Discover Financial Services
Third-Party Payments Segment
(unaudited, dollars in thousands)
	Quarter Ended										Nov 30, 2008					Year Ended
	Nov 30, 2008		Aug 31, 2008		May 31, 2008		Feb 29, 2008		Nov 30, 2007		vs Nov 30, 2007					Nov 30, 2008		Nov 30, 2007		2008 vs 2007

Earnings Summary
Interest Income	$	1,342	$	662	$	533	$	628	$	650	$	692		106	%	$	3,165	$	2,376	$	789		33	%
Interest Expense		64		17		-		2		-		64		100	%		83		19		64	NM
Net Interest Income		1,278		645		533		626		650		628		97	%		3,082		2,357		725		31	%
Other Income		53,113		54,686		37,133		34,268		29,305		23,808		81	%		179,200		118,700		60,500		51	%
Revenue Net of Interest Expense		54,391		55,331		37,666		34,894		29,955		24,436		82	%		182,282		121,057		61,225		51	%
Provision for Loan Losses		-		-		-		-		-		-		0	%		-		-		-		0	%
Total Other Expense		33,841		26,787		20,876		19,367		22,364		11,477		51	%		100,871		84,097		16,774		20	%
Income (Loss) Before Income Taxes	$	20,550	$	28,544	$	16,790	$	15,527	$	7,591	$	12,959		171	%	$	81,411	$	36,960	$	44,451		120	%

Volume
PULSE Network	$	25,033,235	$	28,364,575	$	27,830,403	$	24,783,895	$	23,035,361	$	1,997,874		9	%	$	106,012,108	$	86,236,408	$	19,775,700		23	%
Third-Party Issuers		1,538,013		1,711,617		1,603,006		1,545,943		1,458,959		79,054		5	%		6,398,579		5,480,105		918,474		17	%
Diners Club International 1		7,467,235		5,227,795		-		-		-		7,467,235	NM				12,695,030		-		12,695,030	NM
Total Third-Party Payments	$	34,038,483	$	35,303,987	$	29,433,409	$	26,329,838	$	24,494,320	$	9,544,163		39	%	$	125,105,717	$	91,716,513	$	33,389,204		36	%

Transactions Processed on PULSE Network (000's)		644,045		713,791		703,404		621,072		611,518		32,527		5	%		2,682,312		2,285,061		397,251		17	%

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.

DISCOVER FINANCIAL SERVICES

RECONCILIATION OF GAAP TO MANAGED DATA

The following pages present a reconciliation for certain information disclosed in the financial data supplement.

The data is presented on both a "managed" loan basis and as reported under generally accepted accounting principles ("owned" loan basis). Managed loan data assume that the company's securitized loan receivables have not been sold and presents the results of securitized loan receivables in the same manner as the company's owned loans. The company operates its business and analyzes its financial performance on a managed basis. Accordingly, underwriting and servicing standards are comparable for both owned and securitized loans. The company believes that managed loan information is useful to investors because it provides information regarding the quality of loan origination and credit performance of the entire managed portfolio and allows investors to understand the related credit risks inherent in owned loans and retained interests in securitizations. Managed loan data is also relevant because the company services the securitized and owned loans, and the related accounts, in the same manner without regard to ownership of the loans. In addition, investors often request information on a managed basis which provides a more meaningful comparison to industry competitors.

Discover Financial Services
Reconciliation of GAAP to Managed Data 1
(unaudited, dollars in thousands)

	Quarter Ended															Year Ended
	Nov 30, 2008			Aug 31, 2008			May 31, 2008			Feb 29, 2008			Nov 30, 2007			Nov 30, 2008			Nov 30, 2007

Interest Income
GAAP Basis	$	736,006		$	681,692		$	612,063		$	662,802		$	659,676		$	2,692,563		$	2,584,402
Securitization Adjustments 1		946,261			956,558			960,634			989,813			1,007,742			3,853,266			3,794,272
Managed Basis	$	1,682,267		$	1,638,250		$	1,572,697		$	1,652,615		$	1,667,418		$	6,545,829		$	6,378,674

Interest Expense
GAAP Basis	$	329,672		$	305,643		$	313,248		$	339,441		$	350,917		$	1,288,004		$	1,223,270
Securitization Adjustments		272,778			229,244			237,381			329,512			399,721			1,068,915			1,517,858
Managed Basis	$	602,450		$	534,887		$	550,629		$	668,953		$	750,638		$	2,356,919		$	2,741,128

Net Interest Income
GAAP Basis	$	406,334		$	376,049		$	298,815		$	323,361		$	308,759		$	1,404,559		$	1,361,132
Securitization Adjustments		673,483			727,314			723,253			660,301			608,021			2,784,351			2,276,414
Managed Basis	$	1,079,817		$	1,103,363		$	1,022,068		$	983,662		$	916,780		$	4,188,910		$	3,637,546

Other Income
GAAP Basis	$	1,568,901		$	875,121		$	844,892		$	975,544		$	952,500		$	4,264,458		$	3,376,682
Securitization Adjustments		(281,688	)		(338,124	)		(352,685	)		(338,865	)		(319,486	)		(1,311,362	)		(1,156,906	)
Managed Basis	$	1,287,213		$	536,997		$	492,207		$	636,679		$	633,014		$	2,953,096		$	2,219,776

Revenue Net of Interest Expense
GAAP Basis	$	1,975,235		$	1,251,170		$	1,143,707		$	1,298,905		$	1,261,259		$	5,669,017		$	4,737,814
Securitization Adjustments		391,795			389,190			370,568			321,436			288,535			1,472,989			1,119,508
Managed Basis	$	2,367,030		$	1,640,360		$	1,514,275		$	1,620,341		$	1,549,794		$	7,142,006		$	5,857,322

Provision for Loan Losses
GAAP Basis	$	714,176		$	364,838		$	210,969		$	305,632		$	296,186		$	1,595,615		$	733,887
Securitization Adjustments		391,795			389,190			370,568			321,436			288,535			1,472,989			1,119,508
Managed Basis	$	1,105,971		$	754,028		$	581,537		$	627,068		$	584,721		$	3,068,604		$	1,853,395

Total Assets
GAAP Basis	$	39,892,382		$	37,283,548		$	34,020,245		$	34,222,732		$	33,449,702		$	39,892,382		$	33,449,702
Securitization Adjustments		25,728,094			28,349,277			28,128,332			27,714,769			27,141,773			25,728,094			27,141,773
Managed Basis	$	65,620,476		$	65,632,825		$	62,148,577		$	61,937,501		$	60,591,475		$	65,620,476		$	60,591,475

Tangible Equity/Total Assets
GAAP Basis		13.7	%		14.9	%		16.3	%		15.6	%		15.8	%		13.7	%		15.8	%
Securitization Adjustments		21.2	%		19.5	%		19.7	%		19.3	%		19.5	%		21.2	%		19.5	%
Managed Basis		8.3	%		8.4	%		8.9	%		8.6	%		8.7	%		8.3	%		8.7	%

Loan Receivables
Total Loans
GAAP Basis	$	25,216,611		$	21,767,483		$	20,502,063		$	21,042,681		$	20,831,117		$	25,216,611		$	20,831,117
Securitization Adjustments		25,878,667			28,659,822			27,339,428			26,457,729			27,349,319			25,878,667			27,349,319
Managed Basis	$	51,095,278		$	50,427,305		$	47,841,491		$	47,500,410		$	48,180,436		$	51,095,278		$	48,180,436

Average Total Loans
GAAP Basis	$	22,945,494		$	21,053,804		$	19,890,330		$	21,523,606		$	19,405,775		$	21,348,493		$	19,947,784
Securitization Adjustments		27,761,596			27,965,279			27,581,747			27,339,560			27,975,696			27,662,655			26,965,690
Managed Basis	$	50,707,090		$	49,019,083		$	47,472,077		$	48,863,166		$	47,381,471		$	49,011,148		$	46,913,474

Discover Financial Services

Reconciliation of GAAP to Managed Data 1

(unaudited, dollars in thousands)

Quarter Ended

Year Ended

Nov 30, 2008

Aug 31, 2008

May 31, 2008

Feb 29, 2008

Nov 30, 2007

Nov 30, 2008

Nov 30, 2007

Interest Yield
GAAP Basis		11.36	%		11.41	%		10.40	%		10.34	%		10.51	%		10.89	%		10.73	%
Securitization Adjustments		13.71	%		13.61	%		13.86	%		14.56	%		14.45	%		13.93	%		14.07	%
Managed Basis		12.65	%		12.67	%		12.41	%		12.70	%		12.84	%		12.61	%		12.65	%

Net Principal Charge-off Rate
GAAP Basis		5.25	%		4.76	%		4.49	%		3.83	%		3.43	%		4.59	%		3.40	%
Securitization Adjustments		5.68	%		5.54	%		5.34	%		4.73	%		4.14	%		5.32	%		4.15	%
Managed Basis		5.48	%		5.20	%		4.99	%		4.33	%		3.85	%		5.01	%		3.83	%

Delinquency Rate (over 30 days)
GAAP Basis		4.35	%		3.58	%		3.54	%		3.63	%		3.26	%		4.35	%		3.26	%
Securitization Adjustments		4.77	%		4.06	%		4.01	%		4.11	%		3.82	%		4.77	%		3.82	%
Managed Basis		4.56	%		3.85	%		3.81	%		3.90	%		3.58	%		4.56	%		3.58	%

Delinquency Rate (over 90 days)															��
GAAP Basis		2.06	%		1.73	%		1.81	%		1.82	%		1.51	%		2.06	%		1.51	%
Securitization Adjustments		2.27	%		2.00	%		2.07	%		2.08	%		1.79	%		2.27	%		1.79	%
Managed Basis		2.17	%		1.88	%		1.96	%		1.96	%		1.67	%		2.17	%		1.67	%

Credit Card Loans
Credit Card Loans
GAAP Basis	$	23,814,307		$	20,688,685		$	19,785,414		$	20,556,810		$	20,579,923		$	23,814,307		$	20,579,923
Securitization Adjustments		25,878,667			28,659,822			27,339,428			26,457,729			27,349,319			25,878,667			27,349,319
Managed Basis	$	49,692,974		$	49,348,507		$	47,124,842		$	47,014,539		$	47,929,242		$	49,692,974		$	47,929,242

Average Credit Card Loans
GAAP Basis	$	21,658,816		$	20,202,845		$	19,275,733		$	21,148,252		$	19,276,203		$	20,566,864		$	19,845,880
Securitization Adjustments		27,761,596			27,965,279			27,581,747			27,339,560			27,975,696			27,662,655			26,965,690
Managed Basis	$	49,420,412		$	48,168,124		$	46,857,480		$	48,487,812		$	47,251,899		$	48,229,519		$	46,811,570

Interest Yield
GAAP Basis		11.45	%		11.45	%		10.40	%		10.35	%		10.53	%		10.92	%		10.75	%
Securitization Adjustments		13.71	%		13.61	%		13.86	%		14.56	%		14.45	%		13.93	%		14.07	%
Managed Basis		12.72	%		12.70	%		12.43	%		12.72	%		12.85	%		12.65	%		12.66	%

Net Principal Charge-off Rate
GAAP Basis		5.47	%		4.92	%		4.63	%		3.90	%		3.44	%		4.73	%		3.41	%
Securitization Adjustments		5.68	%		5.54	%		5.34	%		4.73	%		4.14	%		5.32	%		4.15	%
Managed Basis		5.59	%		5.28	%		5.05	%		4.37	%		3.85	%		5.07	%		3.84	%

Delinquency Rate (over 30 days)
GAAP Basis		4.55	%		3.72	%		3.63	%		3.69	%		3.28	%		4.55	%		3.28	%
Securitization Adjustments		4.77	%		4.06	%		4.01	%		4.11	%		3.82	%		4.77	%		3.82	%
Managed Basis		4.66	%		3.92	%		3.85	%		3.93	%		3.59	%		4.66	%		3.59	%

Delinquency Rate (over 90 days)
GAAP Basis		2.16	%		1.81	%		1.87	%		1.86	%		1.53	%		2.16	%		1.53	%
Securitization Adjustments		2.27	%		2.00	%		2.07	%		2.08	%		1.79	%		2.27	%		1.79	%
Managed Basis		2.22	%		1.92	%		1.99	%		1.98	%		1.68	%		2.22	%		1.68	%

1 Securitization Adjustments present the effect of loan securitization by recharacterizing as securitization income the portions of the following items that relate to the securitized loans: interest income, interest expense, provision for loan losses, discount and interchange revenue and loan fee revenues.

Securitization income is reported in other income.

Discover Financial Services (DFS) 8-KNet Income of $432 Million and Earnings Per Share of $0.89