(Adds details, CEO comment)
July 22 Payment services provider Discovery
Financial Services Inc reported a 7 percent rise in
quarterly profit as customers spent more using credit cards in a
recovering U.S. economy.
Total loans rose 6.8 percent to $65.86 billion in the second
quarter ended June 30 while credit card loans rose about 6
percent to $52.74 billion.
Net income rose to $644 million, or $1.35 per share, from
$602 million, or $1.20 per share, a year earlier.
"Our record earnings per share this quarter reflect
outstanding fundamental performance in our Direct Banking
segment in terms of loan growth and credit performance," Chief
Executive David Nelms said.
Revenue, net of interest expense, rose 6.4 percent to $2.17
Analysts on average had expected earnings of $1.30 per share
on revenue of $2.16 billion, according to Thomson Reuters
Net interest income, the difference between what the firm
earns on loans and what its pays on deposits, rose about 11.1
percent to $1.59 billion.
Rival Capital One Financial Corp reported an 8
percent rise in quarterly profit last week, helped by higher
card loans and stable credit quality.
Bigger rival American Express Co reports quarterly
results next week.
Discover's total card volume rose about 7 percent to $31.73
billion, while provision for loan losses rose 50 percent to $360
Shares of the company closed at $64.06 on the New York Stock
Exchange on Tuesday. They have gained more than 13 percent since
the beginning of the year.
(Reporting by Avik Das in Bangalore; Editing by Joyjeet Das)