![]() Craig Streem Vice President, Investor Relations January 29, 2009 Welcome Exhibit 99.1 |
![]() 2 Notice The following slides are part of a presentation by Discover Financial Services (the "Company") and are intended to be viewed as part of that presentation. No representation is made that the information in these slides is complete. The information provided herein may include certain non-GAAP financial measures. The reconciliations of such measures to the comparable GAAP figures are included in the Company’s Form 8-K filed on December 18, 2008 and the Company’s Form10-K for the year ended November 30, 2008, which is on file with the SEC and available on the Company’s website at www.discover.com. 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 November 30, 2008, which is on file with the SEC. Certain historical financial information about the Company that we have included in this presentation has been derived from Morgan Stanley’s consolidated financial statements and does not necessarily reflect what our financial condition, results of operations or cash flows would have been had we operated as a separate, stand-alone company during the periods presented. We own or have rights to use the trademarks, trade names and service marks that we use in conjunction with the operation of our business, including, but not limited to: Discover ® , PULSE ® , Cashback Bonus ® , Discover ® Network and Diners Club International ® . All other trademarks, trade names and service marks included in this presentation are the property of their respective owners. |
![]() David Nelms Chairman & Chief Executive Officer January 29, 2009 Financial Community Briefing |
![]() 4 Company Overview (1) • Leading cash rewards program • 6 th largest U.S. issuer • Over $49Bn in managed receivables • $106Bn volume • 4,500+ issuers • $29Bn deposit base • $1.3Bn personal and student loans • $102Bn volume • 30+ issuers Note(s): 1. All data, including $ volumes, as of November 30, 2008 2. Includes volume prior to acquisition • $31Bn volume (2) • 49 licensees • 185 countries/territories |
![]() 5 Financial • Diluted EPS from continuing operations grew 9% to $2.20 • Credit card sales volume of $92Bn; total loans of $51Bn, up 6% • Managed net charge-off rate of 5.0% • Total volume on our networks of $221Bn, up 19% • Grew deposits by 15% to $29Bn • Continued to build liquidity and capital; tangible equity of $11.37 per share • Settled Visa/MasterCard litigation for $2.75Bn Strategic • Sale of $4Bn UK issuing business • Acquisition of Diners Club; platform for global acceptance • Bank holding company/TARP CPP 2008 Highlights |
![]() 6 Manage conservatively in a challenging environment • Superior credit performance vs. competitors • Conservative loan growth • Increase net interest margin and revenues • Reduce expenses • Focus on capital/liquidity/funding Build for the future • Embrace new Fed rules • Grow direct-to-consumer deposit business • Leverage Discover brand and leading Rewards program • Increase acceptance to drive higher sales • Grow and integrate Diners Club/PULSE/Discover networks Performance Priorities |
![]() 7 Broaden consumer relationships Build global network Further strengthen foundation Acceptance DFS Volume • Discover Card • Third-Party • US acceptance • Diners Club • PULSE Discover’s Strategy DFS Financial wallet share Card wallet share • Brand preference • Products/features • Customer experience • Prime lending • Deposits People/ culture Expense base Funding/ capital |
![]() 8 Today’s Agenda Jim Panzarino SENIOR VICE PRESIDENT, CHIEF CREDIT RISK OFFICER Roy Guthrie EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER Harit Talwar EXECUTIVE VICE PRESIDENT, CARD PROGRAMS & CHIEF MARKETING OFFICER Roger Hochschild PRESIDENT & CHIEF OPERATING OFFICER Diane Offereins EXECUTIVE VICE PRESIDENT, PAYMENT SERVICES Payments U.S. Card Business Segment Strategies Credit Risk Management Financial Review Closing Thoughts and Q&A David Nelms CHAIRMAN & CHIEF EXECUTIVE OFFICER |
![]() Financial Review Roy Guthrie Executive Vice President, Chief Financial Officer January 29, 2009 |
![]() 10 Financial Focus • Earnings • Funding • Capital |
![]() 11 Financial Performance (1) Note(s): 1. Continuing operations on a managed basis 2. Includes $862.5 million related to payment received from MasterCard as payment in full of its portion of the Visa and MasterCard antitrust litigation settlement 3. As a percent of average total loans - managed (MM) $ $ $ bps (3) Net Interest Income $4,189 $3,638 $551 80 Other Income 2,090 2,220 (130) (47) Visa/MasterCard Settlement (2) 863 - 863 176 Revenue Net of Interest Expense 7,142 5,857 1,285 209 Total Provision for Loan Losses 3,069 1,853 (1,215) (231) Total Expense 2,416 2,478 62 35 Pretax Income 1,658 1,526 132 13 Net Income $1,063 $964 $99 11 Diluted EPS from Continuing Operations $2.20 $2.01 $0.19 90 2008 2007 2008 vs. 2007 B/(W) |
![]() 12 Net Interest Margin • Level yield reflects impact of declining Prime offset by marketing actions • Net interest margin improvement driven by improving cost of funds 8.56% 7.76% 12.65% 4.09% 5.08% 12.84% +80 bps Note(s): 1. Interest expense less investment income as a percent of average managed receivables 0 2 4 6 8 10 12 14 4Q07 4Q08 Prime Managed Interest Yield Cost of Funding (1) % |
![]() 13 Other Income Visa/MasterCard Antitrust Settlement Proceeds (MM) Note(s): 1. Payments from Visa will be up to these amounts, which are contingent upon Discover achieving certain financial measures 2. We entered into an agreement with Morgan Stanley at the time of our spin-off to give us sole control over the prosecution and settlement of the Visa/MasterCard antitrust litigation and to determine how proceeds from the litigation would be shared. We have notified Morgan Stanley that it breached the agreement and the amount due to Morgan Stanley, if any, is a matter of dispute. The dispute is a subject of litigation between the parties. 2008 4Q 1Q 2Q 3Q 4Q Total MasterCard $863 Visa (1) $472 $472 $472 $472 $1,888 After Tax 535 293 293 293 293 1,170 Minimum Residual Capital Impact (2) $62 $293 $235 $146 $146 $820 2009 |
![]() 14 Loan Loss Provisions Total Provision Change (MM) ABS mat. Loss Guidance Update • 1Q09 managed charge-off rate anticipated in mid-6% range • 2Q09 managed charge-off rate anticipated above 7% • 1Q09 expect continued reserve build due to credit conditions • On-balance sheet loans expected to grow due to maturing ABS 5.48% 3.85% +382bps • Total provision increased to 8.77% of managed receivables in 4Q08 from 4.95% in 4Q07 454 691 130 300 115 $584 $1,106 4Q07 4Q08 Net Charge-offs Reserve Build ABS Maturities |
![]() 15 Expense Management Non-interest Expense as a % of Loans (1) 5.56% 5.28% 4.93% 2006 2007 2008 Note(s): 1. Managed basis • Refine account acquisition strategy and reduce marketing spend • Optimize customer service – Migrate activities to lower cost channels – Increase on-line customer base • Continued focus on discretionary spend, e.g., professional services • Headcount management Expenses reduced in 2008 and will be driven further down in 2009: Initiatives |
![]() 16 Managed Balance Sheet (Bn) 2008 2007 Assets Cash and Cash Equivalents $10.2 $8.1 Loan Receivables, Net 49.7 47.4 Other Assets 5.7 10.3 Total Assets $65.6 $65.8 Liabilities and Equity Asset-Backed Securitization $25.7 $27.0 Deposits 28.5 24.7 Other Liabilities 5.5 8.5 Total Liabilities 59.7 60.2 Total Equity 5.9 5.6 Total Liabilities and Equity $65.6 $65.8 |
![]() 17 Funding Environment 0 1 2 3 4 5 6% 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 1-Month LIBOR Fed Funds Target Rate 1 Month Libor (1ML) and Fed Funds Target Rate • 1ML to Fed Funds Target rate gap has improved • ABS market still effectively closed • Term Asset-Backed Securities Loan Facility (TALF) expected to begin in February |
![]() 18 0 1 2 3 4 5% 3Q08 4Q08 Discover Direct-to-Consumer 3 Year Posted Rate Fed Funds Target Deposit Funding Environment • Insured deposit markets remain robust • Deposit rates have lagged market rates, but have made substantial moves in the last 45 days 2.72% 3.52% 2.97% |
![]() 19 5.1 8.3 9.4 2.4 1.9 1.5 2.5 2.5 2.4 5.2 $18.5 $10.0 $12.7 Jun-07 4Q07 4Q08 Cash Liquidity Conduit Open Capacity Committed Credit Facility Fed Discount Window Maturities and Liquidity Cash and Contingent Liquidity (Bn) Maturities (Bn) Note(s): 1. Includes conduit issuance and maturities • ‘08 issuance of $22Bn, including $16Bn of CDs (‘07 issuance of $27Bn, including $18Bn of CDs) 7.7 5.1 10.3 9.9 7.7 7.9 $17.6 $12.8 $18.2 2008 2009 2010 ABS CDs (1) |
![]() 20 $5.3 $5.5 $1.2 4Q07 4Q08 Capital Management Capital Management Pro forma 2008 DFS Tangible Capital (Bn) • Long-term ratings at Discover Bank – Fitch BBB – Moody’s Baa2; negative outlook – S&P BBB • Discover Bank remains well capitalized (3) – Total capital ratio 12.9% – Tier 1 capital ratio 11.5% • Preliminary approval to receive $1.2Bn under TARP CPP; expected to support on-balance sheet growth TARP CPP (1) Note(s): 1. Receipt of CPP funds subject to U.S. Treasury final approval and closing conditions 2. As originally reported 3. As of November 30, 2008 TE/MR = 10.2% (2) TE/MR = 11.0% |
![]() 21 $46.0 $44.4 $45.8 $48.2 $51.1 $18.9 $20.6 $20.8 $20.8 $25.2 2004 2005 2006 2007 2008 Owned Loans Managed Loans Prudent Loan Growth Owned vs. Managed Loans (Bn) |
![]() Credit Risk Management James Panzarino Senior Vice President, Chief Credit Risk Officer January 29, 2009 |
![]() • The external environment has worsened significantly since last year – Severe stress in labor markets – Low consumer and business confidence – Rising industry delinquency and bankruptcy • DFS has maintained a competitive advantage in credit risk management – Portfolio composition well positioned – Significant investments and enhancements in credit risk management – Strong relative credit performance in 2008 Credit Risk Overview 23 |
![]() Unemployment Rate Underemployment 3,500 4,500 5,500 6,500 7,500 8,500 Number of Persons Working Part-Time due to Economic Reasons Stress in Labor Market 4.0% 4.5% 5.0% 5.5% 6.0% 6.5% 7.0% 7.5% Source Bureau of Labor Statistics Source Bureau of Labor Statistics 24 |
![]() Consumer Confidence Consumer Confidence Declining 0 20 40 60 80 100 Source Economy.com 25 |
![]() YOY Growth in U.S. Bankruptcy Filings (Sep-Nov 2007 vs. Sep-Nov 2008) Bankruptcies Source National Bankruptcy Research Center • Bankruptcies have grown faster in states with housing- related stress YOY change 50%-100% YOY change 25%-50% YOY change 15%-25% YOY change <15% 35% is the national average YOY change >100% FL NM MD TX OK KS NE SD ND MT WY CO UT ID AZ NV WA CA OR KY NY PA MI NH MA CT VA WV OH IN IL NC TN SC AL AR LA MO IA MN WI GA MS VT NJ DE ME RI AK 26 |
![]() DFS Portfolio Composition > 5 Years Source: Master Trust Receivables Note(s): Data as of: Discover: May-08, Citi: Mar-08, BofA: Mar–08, AMEX: Aug-08, Chase: Sep-08, Capital One: Mar-08 27 Geography Tenure 79% 73% 60% 58% 46% 55% Citi BofA AMEX Chase Capital One 10% 13% 12% 15% 14% 17% 6% 6% 7% 8% 9% 16% 18% 19% 22% 26% 6% 22% Chase Capital One Citi BofA AMEX California Florida |
![]() Risk Management Initiatives 28 Underwriting Models & Criteria Verification & Judgmental Underwriting Management of Contingent Liability Line Management Decision Science Capabilities Initial Line Assignment Credit Strategies |
![]() $5,850 $5,500 4Q07 4Q08 New Account Acquisition Through-the-Door Population Average Assigned Line Source: Internal Data 29 727 734 4Q07 4Q08 Average Booked FICO Source: Internal Data |
![]() Portfolio Line Management 4Q 2007 4Q 2008 -25% YOY Line Increase Dollars Line Decrease Dollars 4Q 2007 4Q 2008 +196% YOY 30 Source: Internal Data |
![]() $62 $83 Dec-07 Dec-08 0 1,000 2,000 3,000 4,000 5,000 6,000 2Q08 3Q08 4Q08 1Q09E Portfolio Management of Contingent Liability Inactive Account Closures (000) Inactive Contingent Liability (Bn) 31 Source: Internal Data |
![]() Collections Activities 32 Refined Collection Models Payment Program Enrollment Collections Website Expanding email servicing capability Authorizations Optimizing Outbound IVR Utilization Collections Strategies |
![]() Help Help customers customers regain regain control control and and identify identify options options that that work work for for them them 33 Vision Vision To be the most rewarding relationship consumers and businesses have with a financial services company Mission Mission To help people spend smarter, manage debt better and save more so they achieve a brighter financial future Tools Tools 2,300 in-house collection associates Flexible payment solutions Credit counseling Sophisticated analytics Diverse communication channels Collections Activities |
![]() Strong Relative Credit Performance Source: SEC Filings Managed Net Charge-off Rate 34 Managed Net Charge-off Rate – YOY % Source: SEC Filings 0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 2003 2004 2005 2006 2007 2008 Industry -60% -40% -20% 0% 20% 40% 60% 80% 2004 2005 2006 2007 2008 Industry |
![]() • The external environment is challenging • Prior years’ actions have positioned DFS portfolio for these challenges • We continue to be proactive and make investments in credit risk management and collections • We are focused on maintaining our strong relative credit performance in 2009 Summary 35 |
![]() Roger Hochschild President & Chief Operating Officer January 29, 2009 Business Segment Strategies |
![]() 37 Manage conservatively in a challenging environment • Superior credit performance vs. competitors • Conservative loan growth • Increase net interest margin and revenues • Reduce expenses • Focus on capital/liquidity/funding Build for the future • Embrace new Fed rules • Grow direct-to-consumer deposit business • Leverage Discover brand and leading Rewards program • Increase acceptance to drive higher sales • Grow and integrate Diners Club/PULSE/Discover networks Performance Priorities |
![]() 38 • Provide consumer reasonable time to make a payment (statements mailed 21 days before payment due date) • Payments above minimum allocated to highest rate balance first or pro-rata among all balances • Issuer may only increase APR for: – New balances or accounts – Accounts more than 30 days delinquent – Variable rate accounts • Two-cycle billing eliminated • New disclosures on monthly statements, account agreements and advertising/solicitation materials Summary of Federal Reserve Credit Card Rules Effective July 1, 2010 |
![]() 39 Introduces new challenges for the industry • Potential negative impact on net interest margin • Significant systems/operational changes However, Discover is embracing the new rules • Aligns with our mission of brighter financial future and focus on prime lending • Already in compliance with some of the new rules - finishing implementation of two-cycle billing changes in 2Q09 Potential for longer term benefits to the industry • Reduce industry reliance on promotional rates and low new account pricing • Reduction in balance transfer volume and churn • May also lead to lower long-term loan losses Impact of New Fed Rules |
![]() 40 Grow Direct-to-Consumer Deposits Business • ~60% of direct-to- consumer balances from Cardmembers • Discover Card debit active population less than 1% penetrated • Emphasis on building awareness/marketing – Discover Card Account Center – E-mail solicitations – Statement inserts – Targeted direct mail Affinities / Partnerships • Roughly 15% of overall direct-to- consumer balances • CDs & CD IRAs more than 90% of accounts & balances • Largest affinity relationship, AAA, generated over $600 million in deposits in 2008 Broad Market • Represents about 25% of overall direct-to-consumer balances • New public website, online application form, and CD IRA product introduced in 2008 • Average per- customer deposits comparable with cross-sell portfolio |
![]() 41 Direct-to-Consumer Deposits Portfolio As of November 30, 2008 36% 31% 33% • 6-month to 2-year CDs • Average renewal-weighted life of 6.1 years • Economics dependent on successful renewal programs Medium-term Time Deposits • Primarily Money Market and 3-month CDs • Average renewal-weighted life of 2.9 years • More rate sensitive Liquid • 30-month to 10-year CDs • Average renewal- weighted life of 10.4 years • Consistently cost- effective relative to brokered CD alternatives • High demand in IRAs and affinity/ partnership portfolios Long-term Deposits |
![]() 42 Priorities Growth in Deposits (Bn) Direct-to-Consumer Priorities • Create best-in-class customer experience • Expand product suite • Grow time deposits to improve maturity balance • Increase Discover deposits advertising/marketing $4.8 $6.1 $3.8 $3.2 $3.0 $2.7 $2.5 $2.4 1Q07 2Q07 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 |
![]() 43 Business Segment Presentations New executive roles: Harit Talwar: Executive Vice President, Card Programs & Chief Marketing Officer Diane Offereins: Executive Vice President, Payment Services |
![]() U.S. Card Harit Talwar Executive Vice President, Card Programs & Chief Marketing Officer January 29, 2009 |
![]() 45 U.S. Card – Mission/Strategy To help people spend smarter, manage debt better and save more so they achieve a brighter financial future Marketing Strategy • Continue to manage and grow business conservatively in both customer acquisition and portfolio management • Continue to invest in and leverage core franchise strengths: – Rewards leadership – Loyal customer base – Customer experience – Merchant relationships – Brand |
![]() 46 • Fewer new accounts as we tighten credit universe and profitability scores • Higher yielding accounts and reduced reliance on promotional pricing • More engaged customers by leveraging the value of the Cashback Bonus ® program New Account Acquisition Results (2008 vs. 2007) • 3 Month Active Rate + 5% • Year 1 Yield +81% |
![]() 47 7.76% 8.55% 4Q07 4Q08 2007 2008 Portfolio Management • Improving portfolio profitability – Balance transfer volume, duration and pricing – Acquisition and portfolio offers • Widening spend margin – Higher customer activity – Introducing premium products – Optimizing rewards program Net Interest Margin (1) Spend Margin (2) +10% Note(s): 1. Managed basis 2. Merchant based revenue less network expenses and rewards costs |
![]() 48 • 40% of the calendar 4th quarter decline due to lower gasoline prices • Additional impact from the apparel and home improvement categories Key Levers • Appropriate credit line strategy • Expanding acceptance • Rewards leadership Sales Volume Update Calendar 4th quarter sales decline of 5% YOY, driven by a 7% decline in December |
![]() 49 Rewards Leadership 5% Cashback Bonus ® Program Sales & Enrollments • Ongoing innovations to help cardmembers earn more rewards and receive higher value redemptions • Continue to drive simplicity, control and engagement for the cardmember • Integrated in every customer touch point • Balance cost of program with value to the customer Merchant Partners 2005 2006 2007 2008 Sales Enrollments CAGR = 42% Sales; 27% Enrollments |
![]() 50 Rewards Leadership Recognized Household Ownership of Cash Rewards Cards (1) Satisfaction Categories Provides customers with rewards that are important to them Makes it easy to earn and redeem rewards Allows customers to accumulate more rewards faster Continually provides new and different ways to earn more rewards Discover Ranking #1 #1 #1 #1 Source 2008 TNS Consumer Card Strategies Research Program Source GfK Brand Communications, Brand Tracker, among General Population respondents familiar with the brand (Discover statistically higher at 95% conf. index); TNS 2008 Consumer Card Strategies Research Program Note(s): 1. Percentages add to >100% due to household use of multiple brands 44% 22% 16% 14% 7% 6% Chase Citi AMEX BofA Capital One |
![]() 51 2005 2006 2007 2008 Customer Service is a Critical Differentiator 2008 J.D. Power Card Satisfaction Index (1) High standards • U.S. based; customer service reps have average tenure of 5 years • Rigorous performance standards • Critical revenue and customer engagement tool Supports growth • Fee product sales • Cross-sell success • High customer retention Fee Product Sales in Service Centers +25% Note(s): 1. Chart excludes National City and Washington Mutual due to mergers 783 751 719 716 710 709 692 667 AMEX Chase U.S. Bank Citi Wells Fargo BofA HSBC |
![]() 52 Online Experience Supports Brand Promise • Innovative capabilities increase customer engagement and usage – Spend Analyzer – Paydown Planner – Purchase Planner – Rewards enrollments and redemptions Purchase Planner: “[This was] very easy to understand. I am planning a big purchase and using the tool helped me figure out how much I could spend.” Paydown Planner: “It is about time that a credit card company provide a tool to help pay down a credit card and not just use more credit.” Spend Analyzer: “This [Spend Analyzer] is very helpful to me and will make me choose this over another credit card.” |
![]() 53 Leveraging Merchant Relationships and Acceptance to Drive Sales Merchant-funded offers to drive sales Point-of-sale marketing and advertising promoting acceptance Promotional offers to drive cardmember activation and merchant sales |
![]() 54 Brand is Well Positioned • The key brand drivers are: – Rewards leadership – Customer experience – Online capabilities – Merchant relationships and acceptance • The current environment provides tremendous opportunities to differentiate the brand and deliver on the mission • Tools are in place to measure and improve brand/ advertising effectiveness Unaided Brand Awareness Source GfK Arbor, 3Q08 data 63% 60% 30% 26% 23% 17% Amex Capital One Chase Citi BofA |
![]() Payment Services Diane Offereins Executive Vice President, Payment Services January 29, 2009 |
![]() 56 Overview • Global payments network targeting upscale customers, frequent travelers and corporate clients • $31Bn volume • 49 licensees • 185 countries/ territories • Fast growing PIN debit and ATM network • $106Bn volume • 4500+ issuers • Domestic acceptance network for Discover proprietary cards and third-party issuers • $102Bn volume • 30+ issuers |
![]() 57 Highlights Profit Before Tax (MM) Payment Services – Profit Before Tax • Launched third-party issuing programs in 1Q05 • Acquired PULSE in January 2005 • Acquired Diners Club in June 2008 $29 $37 $81 2006 2007 2008 |
![]() 58 Payment Services Priorities Acceptance • Complete migration to new merchant acquiring model • Achieve interoperability of Discover and Diners Club networks • Extend global cash access for Diners Club and Discover through PULSE • Broaden Diners Club footprint Drive Volume Growth • Leverage network to grow Discover Card • Expand existing issuer programs • Increase issuer base • Build non-traditional volume |
![]() 59 Acceptance Model Domestic International Global ATM • Direct relationships with the largest merchants • Third-party acquiring (sales, boarding and support) for smaller merchants • Leverage efforts of Diners Club licensees • Network-to-network partnerships (CUP/JCB) • New relationships with third party acquirers • Partnerships and reciprocal agreements |
![]() 60 Driving Discover Card Volume Merchant Partnerships Functionality and Flexibility • Cashback Bonus ® Partner program with 100+ merchants • 5% Cashback Bonus ® program • Customized programs with merchants • Cash Over |
![]() 61 • Leverage existing relationships • Expand issuer base • Grow non-traditional volume • Capture U.S. inbound volume for partner networks (CUP/JCB) Customized Marketing Programs Discover Network Third-Party Volume Third-Party Issuing Volume (Bn) $6.4 $5.5 2007 2008 Priorities |
![]() 62 Diners Club International North America 23% LATAM 12% EMEA 38% Asia Pacific 27% • Execute on interoperability • Reinvigorate brand • Accelerate franchise momentum • Improve acceptance in key markets Volume by Region (1) Priorities Note(s): 1. Includes all Diners Club branded volume |
![]() 63 • Extend and expand key relationships • Superior value proposition • Additional PIN debit relationships based on exclusivity • Enhance fee-based products and services • Provide global cash access for Diners Club/Discover • Invest in technology – maintain “best in class” PULSE 1.9 2.3 2.7 2006 2007 2008 Number of Transactions (Bn) Priorities |
![]() 64 Summary • Well-established complementary networks • Innovative flexible solutions • Strong momentum • Great opportunity |
![]() David Nelms Chairman & Chief Executive Officer January 29, 2009 Financial Community Briefing |
![]() 66 Closing Thoughts Manage conservatively in a challenging environment • Superior credit performance vs. competitors • Conservative loan growth • Increase net interest margin and revenues • Reduce expenses • Focus on capital/liquidity/funding Build for the future • Embrace new Fed rules • Grow direct-to-consumer deposit business • Leverage Discover brand and leading Rewards program • Increase acceptance to drive higher sales • Grow and integrate Diners Club/PULSE/Discover networks |
![]() Q&A |