Discover Financial Services reported a decrease in net principal charge-off rate from 6.03% in February 2024 to 5.48% in February 2025. This marks a significant improvement in credit quality over the past year. In addition, the delinquency rate (30 or more days) also decreased from 4.01% in February 2024 to 3.87% in February 2025, indicating a positive trend in loan repayment behavior.
The ending loans for February 2025 stood at $99.2 billion, showing a slight decrease from $99.9 billion in February 2024. The average loans for the same periods also saw a decline from $100.3 billion to $100.1 billion, reflecting a reduction in the overall loan portfolio.
It's noteworthy that the net principal charge-off rate experienced a month-over-month decrease of approximately 56 basis points in October 2024 due to disaster relief support extended to customers in regions affected by hurricanes Helene and Milton. This exemplifies the company's efforts in managing credit risks during challenging times.
As a result of these announcements, the company's shares have moved 3.2% on the market, and are now trading at a price of $164.26. If you want to know more, read the company's complete 8-K report here.
