Based on the financial data provided by Discover Financial Services, several key metrics have shown significant changes compared to the previous period.
In the quarter ended December 31, 2024, the company reported interest income of $4,989 million, representing a 2% increase from the same period in 2023. However, interest expense decreased by 3% to $1,359 million during the same period. As a result, net interest income increased by 5% to $3,630 million compared to the previous year.
Discover Financial Services also saw a 13% increase in total non-interest income, which stood at $1,129 million in the fourth quarter of 2024. This growth was primarily driven by a 13% increase in discount and interchange revenue, reaching $399 million, and a 34% increase in other income, totaling $404 million.
The company's provision for credit losses decreased significantly by 37% to $1,202 million in the fourth quarter of 2024 compared to the same period in 2023. This reduction contributed to an overall 252% increase in net income, which reached $1,291 million, and a 253% increase in net income allocated to common stockholders, amounting to $1,284 million.
From a balance sheet perspective, Discover Financial Services reported total common equity of $16,870 million, marking a 28% increase compared to the prior year. The company's total common equity as a percentage of total assets also improved to 11.4% in the fourth quarter of 2024, up from 8.7% in the same period in 2023.
Additionally, the company's total liquidity, including the liquidity portfolio, private asset-backed securitization capacity, federal home loan bank borrowing capacity, Federal Reserve discount window, and undrawn credit facilities, grew by 18% to $81,993 million in the fourth quarter of 2024.
Discover Financial Services also experienced a 29% increase in tangible common equity, which stood at $16,615 million, and a 28% increase in tangible common equity per share, reaching $66.10 in the same period.
In terms of regulatory capital ratios, the company reported a 16.5% total risk-based capital ratio, a 15.0% tier 1 risk-based capital ratio, a 12.3% tier 1 leverage ratio, and a 14.1% common equity tier 1 capital ratio in the fourth quarter of 2024.
The market has reacted to these announcements by moving the company's shares -0.1% to a price of $203.91. For more information, read the company's full 8-K submission here.
