DISCOVER FINANCIAL SERVICES																														Exhibit 99.2
EARNINGS SUMMARY
(unaudited, in millions, except per share statistics)
	Quarter Ended																				Six Months Ended
	Jun 30, 2014			Mar 31, 2014			Dec 31, 2013			Sep 30, 2013			Jun 30, 2013			June 30, 2014 vs. June 30, 2013					Jun 30, 2014			Jun 30, 2013			2014 vs. 2013
EARNINGS SUMMARY
Interest Income		$1,863			$1,833			$1,842			$1,787			$1,727			$136		8	%		$3,696			$3,435			$261		8	%
Interest Expense	274			270			273			278			297			(23		)	(8	%)	544			595			(51		)	(9	%)
Net Interest Income	1,589			1,563			1,569			1,509			1,430			159			11	%	3,152			2,840			312			11	%
Discount/Interchange Revenue	595			519			574			550			546			49			9	%	1,114			1,038			76			7	%
Rewards Cost	268			265			295			274			238			30			13	%	533			467			66			14	%
Discount and Interchange Revenue, net	327			254			279			276			308			19			6	%	581			571			10			2	%
Protection Products Revenue	78			83			84			90			88			(10		)	(11	%)	161			176			(15		)	(9	%)
Loan Fee Income	80			83			85			78			76			4			5	%	163			157			6			4	%
Transaction Processing Revenue	46			44			46			46			47			(1		)	(2	%)	90			100			(10		)	(10	%)
Other Income	52			51			66			63			92			(40		)	(43	%)	103			189			(86		)	(46	%)
Total Other Income	583			515			560			553			611			(28		)	(5	%)	1,098			1,193			(95		)	(8	%)
Revenue Net of Interest Expense	2,172			2,078			2,129			2,062			2,041			131			6	%	4,250			4,033			217			5	%
Provision for Loan Losses	360			272			354			333			240			120			50	%	632			399			233			58	%
Employee Compensation and Benefits	301			307			297			292			285			16			6	%	608			575			33			6	%
Marketing and Business Development	168			169			189			174			185			(17		)	(9	%)	337			354			(17		)	(5	%)
Information Processing & Communications	87			84			89			81			85			2			2	%	171			163			8			5	%
Professional Fees	112			99			108			97			101			11			11	%	211			205			6			3	%
Premises and Equipment	22			23			22			21			20			2			10	%	45			39			6			15	%
Other Expense	107			102			133			118			144			(37		)	(26	%)	209			237			(28		)	(12	%)
Total Other Expense	797			784			838			783			820			(23		)	(3	%)	1,581			1,573			8			1	%
Income Before Income Taxes	1,015			1,022			937			946			981			34			3	%	2,037			2,061			(24		)	(1	%)
Tax Expense	371			391			335			353			379			(8		)	(2	%)	762			786			(24		)	(3	%)
Net Income		$644			$631			$602			$593			$602			$42		7	%		$1,275			$1,275			$0		0	%
Net Income Allocated to Common Stockholders		$630			$618			$588			$579			$588			$42		7	%		$1,248			$1,247			$1		0	%
Effective Tax Rate	36.6		%	38.3		%	35.8		%	37.3		%	38.6		%						37.4		%	38.1		%
Net Interest Margin	9.84		%	9.87		%	9.81		%	9.64		%	9.44		%	40			bps		9.86		%	9.41		%	45			bps
ROE	23		%	23		%	22		%	23		%	23		%						23		%	25		%
Ending Common Shares Outstanding	465			468			472			479			486			(21		)	(4	%)	465			486			(21		)	(4	%)
Weighted Average Common Shares Outstanding	466			471			475			482			489			(23		)	(5	%)	468			492			(24		)	(5	%)
Weighted Average Common Shares Outstanding (fully diluted)	467			472			477			484			490			(23		)	(5	%)	469			494			(25		)	(5	%)
PER SHARE STATISTICS
Basic EPS		$1.35			$1.31			$1.24			$1.20			$1.20			$0.15		13	%		$2.66			$2.53			$0.13		5	%
Diluted EPS		$1.35			$1.31			$1.23			$1.20			$1.20			$0.15		13	%		$2.66			$2.52			$0.14		6	%
Common Stock Price (period end)		$61.98			$58.19			$55.95			$50.54			$47.64			$14.34		30	%		$61.98			$47.64			$14.34		30	%
Book Value per share		$24.46			$23.53			$22.89			$22.14			$21.52			$2.94		14	%		$24.46			$21.52			$2.94		14	%
Note: See Glossary of Financial Terms for definitions of financial terms.

DISCOVER FINANCIAL SERVICES
EARNINGS SUMMARY
(unaudited, in millions)
	Quarter Ended																Six Months Ended
	Jun 30, 2014		Mar 31, 2014		Dec 31, 2013		Sep 30, 2013		Jun 30, 2013			June 30, 2014 vs. June 30, 2013					Jun 30, 2014		Jun 30, 2013		2014 vs. 2013
SEGMENT- INCOME BEFORE INCOME TAXES
Direct Banking		$984		$994		$911		$918		$1,002			($18	)	(2	%)		$1,978		$2,035		($57	)	(3	%)
Payment Services	31		28		26		28		(21		)	52			NM		59		26		33			127	%
Total		$1,015		$1,022		$937		$946		$981			$34		3	%		$2,037		$2,061		($24	)	(1	%)
TRANSACTIONS PROCESSED ON NETWORKS
Discover Network	514		461		522		500		483			31			6	%	975		925		50			5	%
PULSE Network	1,090		1,037		1,044		1,053		1,067			23			2	%	2,127		2,090		37			2	%
Total	1,604		1,498		1,566		1,553		1,550			54			3	%	3,102		3,015		87			3	%
NETWORK VOLUME
PULSE Network		$41,500		$41,927		$40,368		$39,458		$40,060			$1,440		4	%		$83,427		$79,979		$3,448		4	%
Network Partners	2,617		2,381		2,613		2,507		2,442			175			7	%	4,998		4,688		310			7	%
Diners Club International 1	6,733		6,527		6,826		6,549		6,848			(115		)	(2	%)	13,260		13,491		(231		)	(2	%)
Total Payment Services	50,850		50,835		49,807		48,514		49,350			1,500			3	%	101,685		98,158		3,527			4	%
Discover Network - Proprietary	30,342		26,547		30,622		28,880		28,551			1,791			6	%	56,889		54,289		2,600			5	%
Total		$81,192		$77,382		$80,429		$77,394		$77,901			$3,291		4	%		$158,574		$152,447		$6,127		4	%
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.
Note: See Glossary of Financial Terms for definitions of financial terms.

DISCOVER FINANCIAL SERVICES
BALANCE SHEET STATISTICS
(unaudited, in millions)
	Quarter Ended
	Jun 30, 2014			Mar 31, 2014			Dec 31, 2013			Sep 30, 2013			Jun 30, 2013			June 30, 2014 vs. June 30, 2013
BALANCE SHEET SUMMARY
Assets
Cash and Investment Securities		$11,254			$13,858			$11,727			$10,820			$11,224			$30		0	%
Total Loan Receivables	65,875			63,852			65,771			62,738			61,703			4,172			7	%
Allowance for Loan Losses	(1,614		)	(1,591		)	(1,648		)	(1,598		)	(1,556		)	(58		)	(4	%)
Net Loan Receivables	64,261			62,261			64,123			61,140			60,147			4,114			7	%
Premises and Equipment, net	665			668			654			639			607			58			10	%
Goodwill and Intangible Assets, net	463			466			469			472			475			(12		)	(3	%)
Other Assets	2,294			2,331			2,367			2,473			2,491			(197		)	(8	%)
Total Assets		$78,937			$79,584			$79,340			$75,544			$74,944			$3,993		5	%
Liabilities & Stockholders' Equity
Direct to Consumer and Affinity Deposits		$28,739			$28,711			$28,357			$28,854			$29,063			($324	)	(1	%)
Brokered Deposits and Other Deposits	15,706			16,273			16,602			14,263			13,505			2,201			16	%
Deposits	44,445			44,984			44,959			43,117			42,568			1,877			4	%
Borrowings	20,177			20,306			20,614			18,789			18,295			1,882			10	%
Accrued Expenses and Other Liabilities	2,934			3,273			2,958			3,036			3,633			(699		)	(19	%)
Total Liabilities	67,556			68,563			68,531			64,942			64,496			3,060			5	%
Total Equity	11,381			11,021			10,809			10,602			10,448			933			9	%
Total Liabilities and Stockholders' Equity		$78,937			$79,584			$79,340			$75,544			$74,944			$3,993		5	%
BALANCE SHEET STATISTICS
Total Common Equity		$10,821			$10,461			$10,249			$10,042			$9,888			$933		9	%
Total Common Equity/Total Assets	13.7		%	13.1		%	12.9		%	13.3		%	13.2		%
Total Common Equity/Net Loans	16.8		%	16.8		%	16.0		%	16.4		%	16.4		%
Tangible Assets		$78,474			$79,118			$78,871			$75,072			$74,469			$4,005		5	%
Tangible Common Equity 1		$10,358			$9,995			$9,780			$9,570			$9,413			$945		10	%
Tangible Common Equity/Tangible Assets 1	13.2		%	12.6		%	12.4		%	12.7		%	12.6		%
Tangible Common Equity/Net Loans 1	16.1		%	16.1		%	15.3		%	15.7		%	15.6		%
Tangible Common Equity per share  1		$22.26			$21.34			$20.71			$19.99			$19.38			$2.88		15	%
REGULATORY CAPITAL RATIOS
Total Risk Based Capital Ratio	18.3		%	18.1		%	17.4		%	17.9		%	17.8		%
Tier 1 Risk Based Capital Ratio	16.0		%	15.8		%	15.2		%	15.6		%	15.5		%
Tier 1 Common Capital Ratio 2	15.2		%	14.9		%	14.3		%	14.7		%	14.6		%
Tier 1 Leverage Ratio	14.0		%	13.4		%	13.4		%	13.7		%	13.4		%
LIQUIDITY
Liquidity Portfolio	$10,337				$12,141			$11,115			$10,177			$9,717			$620		6	%
Undrawn Credit Facilities 3	22,964			22,284			21,500			20,987			18,496			4,468			24	%
Total Liquidity		$33,301			$34,425			$32,615			$31,164			$28,213			$5,088		18	%
1 Tangible Common Equity ("TCE") is a non-GAAP measure. The Company believes TCE is a more meaningful measure to investors of the net asset value of the Company. For corresponding reconciliation of TCE to a GAAP financial measure see Reconciliation of GAAP to non-GAAP Data schedule.
2 Tier 1 Common Capital Ratio is calculated using tier 1 common capital, a non-GAAP measure. The Company believes the tier 1 common capital ratio is meaningful to investors to assess the quality and composition of the Company’s capital. For corresponding reconciliation of tier 1 common capital to a GAAP financial measure see Reconciliation of GAAP to non-GAAP Data schedule.
3 Excludes investments pledged to the Federal Reserve, which is included within the liquidity portfolio.
Note: See Glossary of Financial Terms for definitions of financial terms.

DISCOVER FINANCIAL SERVICES
AVERAGE BALANCE SHEET
(unaudited, in millions)
	Quarter Ended
	Jun 30, 2014			Mar 31, 2014			Dec 31, 2013			Sep 30, 2013			Jun 30, 2013			June 30, 2014 vs. June 30, 2013
AVERAGE BALANCES
Assets
Cash and Investment Securities		$11,037			$11,244			$11,661			$9,732			$11,097			($60	)	(1	%)
Restricted Cash	563			1,768			488			438			1,176			(613		)	(52	%)
Credit Card Loans	51,718			51,347			50,957			50,017			49,002			2,716			6	%
Private Student Loans	8,301			8,377			8,124			7,941			7,925			376			5	%
Personal Loans	4,426			4,259			4,114			3,843			3,511			915			26	%
Other Loans	283			244			248			309			355			(72		)	(20	%)
Total Loans	64,728			64,227			63,443			62,110			60,793			3,935			6	%
Total Interest Earning Assets	76,328			77,239			75,592			72,280			73,066			3,262			4	%
Allowance for Loan Losses	(1,599		)	(1,678		)	(1,575		)	(1,564		)	(1,600		)	1			0	%
Other Assets	4,253			4,271			4,405			4,352			4,274			(21		)	(0	%)
Total Assets		$78,982			$79,832			$78,422			$75,068			$75,740			$3,242		4	%
Liabilities and Stockholders' Equity
Direct to Consumer and Affinity Deposits		$28,752			$28,572			$28,592			$29,009			$28,946			($194	)	(1	%)
Brokered Deposits and Other Deposits	15,638			16,280			15,669			13,414			13,756			1,882			14	%
Total Interest-bearing Deposits	44,390			44,852			44,261			42,423			42,702			1,688			4	%
Short-term Borrowings	113			93			114			173			270			(157		)	(58	%)
Securitized Borrowings	15,976			17,014			16,584			15,625			16,412			(436		)	(3	%)
Other Long-term Borrowings	3,889			3,572			3,099			2,778			2,487			1,402			56	%
Total Interest-bearing Liabilities	64,368			65,531			64,058			60,999			61,871			2,497			4	%
Other Liabilities & Stockholders' Equity	14,614			14,301			14,364			14,069			13,869			745			5	%
Total Liabilities and Stockholders' Equity		$78,982			$79,832			$78,422			$75,068			$75,740			$3,242		4	%
AVERAGE RATES
Assets
Cash and Investment Securities	0.76		%	0.75		%	0.77		%	0.79		%	0.82		%	(6		)	bps
Restricted Cash	0.08		%	0.08		%	0.06		%	0.09		%	0.11		%	(3		)	bps
Credit Card Loans	12.10		%	12.14		%	12.08		%	12.00		%	11.97		%	13			bps
Private Student Loans	6.84		%	6.85		%	6.63		%	6.51		%	6.52		%	32			bps
Personal Loans	12.49		%	12.54		%	12.53		%	12.57		%	12.51		%	(2		)	bps
Other Loans	3.69		%	3.27		%	3.12		%	3.43		%	3.27		%	42			bps
Total Loans	11.42		%	11.44		%	11.38		%	11.29		%	11.24		%	18			bps
Total Interest Earning Assets	9.79		%	9.62		%	9.67		%	9.81		%	9.48		%	31			bps
Liabilities and Stockholders' Equity
Direct to Consumer and Affinity Deposits	1.27		%	1.29		%	1.33		%	1.42		%	1.50		%	(23		)	bps
Brokered Deposits and Other Deposits	1.54		%	1.54		%	1.58		%	1.92		%	2.21		%	(67		)	bps
Total Interest-bearing Deposits	1.37		%	1.38		%	1.42		%	1.58		%	1.73		%	(36		)	bps
Short-term Borrowings	1.60		%	1.90		%	2.04		%	1.78		%	1.36		%	24			bps
Securitized Borrowings	1.74		%	1.67		%	1.65		%	1.70		%	1.78		%	(4		)	bps
Other Long-term Borrowings	5.54		%	5.24		%	5.78		%	5.91		%	6.26		%	(72		)	bps
Total Interest-bearing Liabilities	1.71		%	1.67		%	1.69		%	1.81		%	1.92		%	(21		)	bps
Net Interest Margin	9.84		%	9.87		%	9.81		%	9.64		%	9.44		%	40			bps
Net Yield on Interest-earning Assets	8.35		%	8.21		%	8.23		%	8.28		%	7.85		%	50			bps
Note: See Glossary of Financial Terms for definitions of financial terms.

DISCOVER FINANCIAL SERVICES
LOAN STATISTICS
(unaudited, in millions)
	Quarter Ended																				Six Months Ended
	Jun 30, 2014			Mar 31, 2014			Dec 31, 2013			Sep 30, 2013			Jun 30, 2013			June 30, 2014 vs. June 30, 2013					Jun 30, 2014			Jun 30, 2013			2014 vs. 2013
TOTAL LOAN RECEIVABLES
Ending Loans 1, 2		$65,875			$63,852			$65,771			$62,738			$61,703			$4,172		7	%		$65,875			$61,703			$4,172		7	%
Average Loans 1, 2		$64,728			$64,227			$63,443			$62,110			$60,793			$3,935		6	%		$64,479			$60,848			$3,631		6	%
Interest Yield	11.42		%	11.44		%	11.38		%	11.29		%	11.24		%	18			bps		11.43		%	11.23		%	20			bps
Gross Principal Charge-off Rate	2.82		%	2.82		%	2.63		%	2.66		%	2.99		%	(17		)	bps		2.82		%	2.99		%	(17		)	bps
Gross Principal Charge-off Rate excluding PCI Loans 3	3.01		%	3.01		%	2.82		%	2.86		%	3.23		%	(22		)	bps		3.01		%	3.23		%	(22		)	bps
Net Principal Charge-off Rate	2.08		%	2.08		%	1.90		%	1.86		%	2.10		%	(2		)	bps		2.08		%	2.09		%	(1		)	bps
Net Principal Charge-off Rate excluding PCI Loans 3	2.22		%	2.22		%	2.03		%	2.00		%	2.27		%	(5		)	bps		2.22		%	2.26		%	(4		)	bps
Delinquency Rate (over 30 days) excluding PCI Loans 3	1.56		%	1.65		%	1.64		%	1.60		%	1.50		%	6			bps		1.56		%	1.50		%	6			bps
Delinquency Rate (over 90 days) excluding PCI Loans 3	0.73		%	0.80		%	0.77		%	0.72		%	0.73		%	—			bps		0.73		%	0.73		%	—			bps
Gross Principal Charge-off Dollars		$455			$447			$421			$416			$453			$2		0	%		$902			$903			($1	)	(0	%)
Net Principal Charge-off Dollars		$337			$329			$304			$291			$318			$19		6	%		$666			$631			$35		6	%
Net Interest and Fee Charge-off Dollars		$87			$89			$82			$79			$85			$2		2	%		$176			$177			($1	)	(1	%)
Loans Delinquent Over 30 Days 3		$964			$985			$1,010			$933			$861			$103		12	%		$964			$861			$103		12	%
Loans Delinquent Over 90 Days 3		$451			$478			$475			$421			$419			$32		8	%		$451			$419			$32		8	%
Allowance for Loan Loss (period end)		$1,614			$1,591			$1,648			$1,598			$1,556			$58		4	%		$1,614			$1,556			$58		4	%
Change in Loan Loss Reserves		$23			($57	)		$50			$42			($78	)		$101		129	%		($34	)		($232	)		$198		85	%
Reserve Rate	2.45		%	2.49		%	2.51		%	2.55		%	2.52		%	(7		)	bps		2.45		%	2.52		%	(7		)	bps
Reserve Rate Excluding PCI Loans 3	2.56		%	2.61		%	2.63		%	2.73		%	2.72		%	(16		)	bps		2.56		%	2.72		%	(16		)	bps
CREDIT CARD LOANS
Ending Loans		$52,742			$50,879			$53,150			$50,360			$49,791			$2,951		6	%		$52,742			$49,791			$2,951		6	%
Average Loans		$51,718			$51,347			$50,957			$50,017			$49,002			$2,716		6	%		$51,534			$49,134			$2,400		5	%
Interest Yield	12.10		%	12.14		%	12.08		%	12.00		%	11.97		%	13			bps		12.12		%	11.96		%	16			bps
Gross Principal Charge-off Rate	3.22		%	3.22		%	2.98		%	3.02		%	3.41		%	(19		)	bps		3.22		%	3.45		%	(23		)	bps
Net Principal Charge-off Rate	2.33		%	2.32		%	2.09		%	2.05		%	2.34		%	(1		)	bps		2.32		%	2.35		%	(3		)	bps
Delinquency Rate (over 30 days)	1.63		%	1.72		%	1.72		%	1.67		%	1.58		%	5			bps		1.63		%	1.58		%	5			bps
Delinquency Rate (over 90 days)	0.80		%	0.87		%	0.84		%	0.78		%	0.80		%	—			bps		0.80		%	0.80		%	—			bps
Gross Principal Charge-off Dollars		$415			$408			$384			$381			$417			($2	)	(0	%)		$823			$839			($16	)	(2	%)
Net Principal Charge-off Dollars		$300			$294			$269			$258			$286			$14		5	%		$594			$573			$21		4	%
Loans Delinquent Over 30 Days		$860			$876			$912			$843			$789			$71		9	%		$860			$789			$71		9	%
Loans Delinquent Over 90 Days		$420			$442			$447			$395			$398			$22		6	%		$420			$398			$22		6	%
Allowance for Loan Loss (period end)		$1,359			$1,342			$1,406			$1,393			$1,360			($1	)	(0	%)		$1,359			$1,360			($1	)	(0	%)
Change in Loan Loss Reserves		$17			($64	)		$13			$33			($93	)		$110		118	%		($47	)		($253	)		$206		81	%
Reserve Rate	2.58		%	2.64		%	2.65		%	2.77		%	2.73		%	(15		)	bps		2.58		%	2.73		%	(15		)	bps
Total Discover Card Volume		$31,732			$28,077			$31,755			$30,275			$29,684			$2,048		7	%		$59,809			$56,564			$3,245		6	%
Discover Card Sales Volume		$29,341			$25,697			$29,530			$27,989			$27,574			$1,767		6	%		$55,038			$52,438			$2,600		5	%
1 Total Loans includes mortgages and other loans.
2 Purchased Credit Impaired ("PCI") loans are loans that were acquired in which a deterioration in credit quality occurred between the origination date and the acquisition date. These loans were initially recorded at fair value and accrete interest income over the estimated lives of the loans as long as cash flows are reasonably estimable, even if the loans are contractually past due. PCI loans are private student loans and are included in total loan receivables.
3 Excludes PCI loans (described above) which are accounted for on a pooled basis. Since a pool is accounted for as a single asset with a single composite interest rate and aggregate expectation of cash flows, the past-due status of a pool, or that of the individual loans within a pool, is not meaningful. Because the company is recognizing interest income on a pool of loans, it is all considered to be performing.
Note: See Glossary of Financial Terms for definitions of financial terms.

DISCOVER FINANCIAL SERVICES
LOAN STATISTICS
(unaudited, in millions)
	Quarter Ended																				Six Months Ended
	Jun 30, 2014			Mar 31, 2014			Dec 31, 2013			Sep 30, 2013			Jun 30, 2013			June 30, 2014 vs. June 30, 2013					Jun 30, 2014			Jun 30, 2013			2014 vs. 2013
PRIVATE STUDENT LOANS
Ending Loans		$8,251			$8,372			$8,148			$8,125			$7,881			$370		5	%		$8,251			$7,881			$370		5	%
Ending PCI Loans 1		$3,915			$4,046			$4,178			$4,303			$4,434			($519	)	(12	%)		$3,915			$4,434			($519	)	(12	%)
Interest Yield	6.84		%	6.85		%	6.63		%	6.51		%	6.52		%	32			bps		6.84		%	6.52		%	32			bps
Net Principal Charge-off Rate	0.68		%	0.67		%	0.67		%	0.60		%	0.68		%	—			bps		0.67		%	0.51		%	16			bps
Net Principal Charge-off Rate excluding PCI Loans 2	1.30		%	1.31		%	1.41		%	1.33		%	1.58		%	(28		)	bps		1.31		%	1.21		%	10			bps
Delinquency Rate (over 30 days) excluding PCI Loans 2	1.66		%	1.79		%	1.66		%	1.60		%	1.38		%	28			bps		1.66		%	1.38		%	28			bps
Reserve Rate	1.55		%	1.45		%	1.39		%	1.02		%	1.04		%	51			bps		1.55		%	1.04		%	51			bps
Reserve Rate excluding PCI Loans 2	2.29		%	2.16		%	2.14		%	2.18		%	2.38		%	(9		)	bps		2.29		%	2.38		%	(9		)	bps
PERSONAL LOANS
Ending Loans		$4,579			$4,310			$4,191			$3,995			$3,630			$949		26	%		$4,579			$3,630			$949		26	%
Interest Yield	12.49		%	12.54		%	12.53		%	12.57		%	12.51		%	(2		)	bps		12.52		%	12.49		%	3			bps
Net Principal Charge-off Rate	1.95		%	2.07		%	2.00		%	2.01		%	2.24		%	(29		)	bps		2.01		%	2.27		%	(26		)	bps
Delinquency Rate (over 30 days)	0.66		%	0.68		%	0.70		%	0.65		%	0.64		%	2			bps		0.66		%	0.64		%	2			bps
Reserve Rate	2.37		%	2.52		%	2.67		%	2.66		%	2.70		%	(33		)	bps		2.37		%	2.70		%	(33		)	bps
1 Purchased Credit Impaired ("PCI") loans are loans that were acquired in which a deterioration in credit quality occurred between the origination date and the acquisition date. These loans were initially recorded at fair value and accrete interest income over the estimated lives of the loans as long as cash flows are reasonably estimable, even if the loans are contractually past due. PCI loans are private student loans and are included in total loan receivables.
2 Excludes PCI loans (described above) which are accounted for on a pooled basis. Since a pool is accounted for as a single asset with a single composite interest rate and aggregate expectation of cash flows, the past-due status of a pool, or that of the individual loans within a pool, is not meaningful. Because the company is recognizing interest income on a pool of loans, it is all considered to be performing.
Note: See Glossary of Financial Terms for definitions of financial terms.

DISCOVER FINANCIAL SERVICES
SEGMENT RESULTS
(unaudited, in millions)
	Quarter Ended																				Six Months Ended
	Jun 30, 2014			Mar 31, 2014			Dec 31, 2013			Sep 30, 2013			Jun 30, 2013			June 30, 2014 vs. June 30, 2013					Jun 30, 2014			Jun 30, 2013			2014 vs. 2013
DIRECT BANKING
Interest Income		$1,863			$1,833			$1,842			$1,787			$1,727			$136		8	%		$3,696			$3,435			$261		8	%
Interest Expense	274			270			273			278			297			(23		)	(8	%)	544			595			(51		)	(9	%)
Net Interest Income	1,589			1,563			1,569			1,509			1,430			159			11	%	3,152			2,840			312			11	%
Other Income	503			436			475			475			531			(28		)	(5	%)	939			1,026			(87		)	(8	%)
Revenue Net of Interest Expense	2,092			1,999			2,044			1,984			1,961			131			7	%	4,091			3,866			225			6	%
Provision for Loan Losses	360			270			352			333			225			135			60	%	630			384			246			64	%
Total Other Expense	748			735			781			733			734			14			2	%	1,483			1,447			36			2	%
Income Before Income Taxes		$984			$994			$911			$918			$1,002			($18	)	(2	%)		$1,978			$2,035			($57	)	(3	%)
Net Interest Margin	9.85		%	9.88		%	9.82		%	9.65		%	9.44		%	41			bps		9.87		%	9.41		%	46			bps
Pretax Return on Loan Receivables	6.10		%	6.29		%	5.70		%	5.88		%	6.61		%	(51		)	bps		6.19		%	6.74		%	(55		)	bps
PAYMENT SERVICES
Interest Income		$—			$—			$—			$—			$—			$—		NM			$—			$—			$—		NM
Interest Expense	—			—			—			—			—			—			NM		—			—			—			NM
Net Interest Income	—			—			—			—			—			—			NM		—			—			—			NM
Other Income	80			79			85			78			80			—			0	%	159			167			(8		)	(5	%)
Revenue Net of Interest Expense	80			79			85			78			80			—			0	%	159			167			(8		)	(5	%)
Provision for Loan Losses	—			2			2			—			15			(15		)	(100%)		2			15			(13		)	(87%)
Total Other Expense	49			49			57			50			86			(37		)	(43	%)	98			126			(28		)	(22	%)
Income Before Income Taxes		$31			$28			$26			$28			($21	)		$52		NM			$59			$26			$33		127	%
Note: See Glossary of Financial Terms for definitions of financial terms.

DISCOVER FINANCIAL SERVICES

GLOSSARY OF FINANCIAL TERMS

Book Value per share represents total equity divided by ending common shares outstanding.

Delinquency Rate (Over 30 Days) represents loans delinquent over thirty days divided by ending loans (total or respective loans, as appropriate).

Delinquency Rate (Over 90 Days) represents loans delinquent over ninety days divided by ending loans (total or respective loans, as appropriate).

Earnings Per Share represents net income allocated to common stockholders divided by the weighted average common shares outstanding.

Effective Tax Rate represents tax expense divided by income before income taxes.

Gross Principal Charge-off Rate represents gross principal charge-off dollars (annualized) divided by average loans for the reporting period.

Interest Yield represents interest income on loan receivables (annualized) divided by average loans for the reporting period.

Liquidity Portfolio represents cash and cash equivalents (excluding cash-in-process) and other investments.

Net Income Allocated to Common Stockholders represents net income less (i) dividends and accretion of discount on shares of preferred stock and (ii) income allocated to participating securities.

Net Interest Margin represents net interest income (annualized) divided by average total loans for the period.

Net Principal Charge-off Rate represents net principal charge-off dollars (annualized) divided by average loans for the reporting period.

Pretax Return on Loan Receivables represents income before income taxes (annualized) divided by total average loans for the period.

Proprietary Network Volume represents gross proprietary sales volume on the Discover Network.

Regulatory Capital Ratios are regulatory measures used to evaluate capital adequacy. To be considered "well-capitalized," total risk-based, tier 1 risk-based, and tier 1 leverage ratios of 10%, 6% and 5% respectively must be maintained. Total Risk Based Capital Ratio represents total capital divided by risk-weighted assets. Tier 1 Capital Ratio represents tier 1 capital divided by risk-weighted assets. Tier 1 Leverage Ratio represents tier 1 capital divided by average total assets. Tier 1 Common Capital Ratio represents tier 1 common capital, a non-GAAP measure, divided by risk-weighted assets. For corresponding reconciliation of tier 1 common capital to a GAAP financial measure, see Reconciliation of GAAP to Non-GAAP Data schedule.

Reserve Rate represents the allowance for loan losses divided by total loans.

Return on Equity represents net income (annualized) divided by average total equity for the reporting period.

Tangible Assets represents total assets less goodwill and intangibles.

Tangible Common Equity ("TCE"), a non-GAAP financial measure, represents total common equity less goodwill and intangibles. The Company believes TCE is a more meaningful measure to investors of the net asset value of the Company. For corresponding reconciliation of TCE to a GAAP financial measure, see Reconciliation of GAAP to Non-GAAP Data schedule.

Tangible Common Equity/Net Loans,a non-GAAP measure,represents total common equity less goodwill and intangibles divided by total loans less the allowance for loan loss (period end).

Tangible Common Equity per Share,a non-GAAP measure,represents total common equity less goodwill and intangibles divided by ending common shares outstanding.

Tangible Common Equity/Tangible Assets, a non-GAAP measure,represents total common equity less goodwill and intangibles divided by total assets less goodwill and intangibles.

Undrawn Credit Facilities represents asset-backed conduit funding facilities and Federal Reserve discount window (excluding investments pledged to the Federal Reserve, which are included within the liquidity investment portfolio).

DISCOVER FINANCIAL SERVICES
RECONCILIATION OF GAAP TO NON-GAAP DATA
(unaudited, in millions)
	Quarter Ended
	Jun 30, 2014			Mar 31, 2014			Dec 31, 2013			Sep 30, 2013			Jun 30, 2013
GAAP total common equity		$10,821			$10,461			$10,249			$10,042			$9,888
Less: Goodwill	(284		)	(284		)	(284		)	(284		)	(284		)
Less: Intangibles	(179		)	(182		)	(185		)	(188		)	(191		)
Tangible common equity 1		$10,358			$9,995			$9,780			$9,570			$9,413
Effect of certain items in accumulated other comprehensive income (loss) excluded from tier 1 common capital	73			71			69			110			106
Total tier 1 common capital 2		$10,431			$10,066			$9,849			$9,680			$9,519
Risk weighted assets	$	68,755		$	67,365		$	68,649		$	65,741		$	65,087
Tier 1 common capital ratio  3	15.2		%	14.9		%	14.3		%	14.7		%	14.6		%
GAAP book value per share		$24.46			$23.53			$22.89			$22.14			$21.52
Less: Goodwill	(0.62		)	(0.60		)	(0.60		)	(0.59		)	(0.59		)
Less: Intangibles	(0.38		)	(0.39		)	(0.39		)	(0.39		)	(0.40		)
Less: Preferred Stock	(1.20		)	(1.20		)	(1.19		)	(1.17		)	(1.15		)
Tangible common equity per share		$22.26			$21.34			$20.71			$19.99			$19.38
1 Tangible common equity ("TCE"), a non-GAAP financial measure, represents common equity less goodwill and intangibles. A reconciliation of TCE to common equity, a GAAP financial measure, is shown above. Other financial services companies may also use TCE and definitions may vary, so we advise users of this information to exercise caution in comparing TCE of different companies. TCE is included because management believes that common equity excluding goodwill and intangibles is a more meaningful measure to investors of the true net asset value of the company.
2 Tier 1 common capital, a non-GAAP financial measure, represents common equity and the effect of certain items in accumulated other comprehensive income (loss) excluded from tier 1 common capital, less goodwill and intangibles. A reconciliation of tier 1 common capital to common equity, a GAAP financial measure, is shown above. Other financial services companies may also use tier 1 common capital and definitions may vary, so we advise users of this information to exercise caution in comparing tier 1 common capital of different companies. Tier 1 common capital is included to support the tier 1 common capital ratio which is meaningful to investors to assess the quality and composition of the Company’s capital.
3  Tier 1 common capital ratio is calculated using tier 1 common capital, a non-GAAP measure, divided by risk weighted assets.