EX-99.2 3 dfs2019930ex992.htm EXHIBIT 99.2 Exhibit


DISCOVER FINANCIAL SERVICES
 
 
 
 
Exhibit 99.2
 
 
EARNINGS SUMMARY
 
 
 
 
 
 
 
 
(unaudited, in millions, except per share statistics)
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
 
Nine Months Ended
 
 
 
 
 
Sep 30, 2019
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Sep 30, 2019 vs. Sep 30, 2018
 
Sep 30, 2019
 
Sep 30, 2018
 
2019 vs. 2018
 
EARNINGS SUMMARY
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Income

$3,040

 

$2,977

 

$2,937

 

$2,907

 

$2,781

 

$259

 
9
%
 

$8,954

 

$7,986

 

$968

12
%
 
Interest Expense
638

 
645

 
632

 
605

 
558

 
80

 
14
%
 
1,915

 
1,534

 
381

25
%
 
Net Interest Income
2,402

 
2,332

 
2,305

 
2,302

 
2,223

 
179

 
8
%
 
7,039

 
6,452

 
587

9
%
 
Discount/Interchange Revenue
775

 
759

 
677

 
752

 
753

 
22

 
3
%
 
2,211

 
2,123

 
88

4
%
 
Rewards Cost
520

 
460

 
446

 
475

 
473

 
47

 
10
%
 
1,426

 
1,326

 
100

8
%
 
Discount and Interchange Revenue, net
255

 
299

 
231

 
277

 
280

 
(25
)
 
(9
%)
 
785

 
797

 
(12
)
(2
%)
 
Protection Products Revenue
48

 
49

 
49

 
50

 
51

 
(3
)
 
(6
%)
 
146

 
154

 
(8
)
(5
%)
 
Loan Fee Income
120

 
102

 
104

 
108

 
103

 
17

 
17
%
 
326

 
294

 
32

11
%
 
Transaction Processing Revenue
52

 
48

 
46

 
46

 
47

 
5

 
11
%
 
146

 
132

 
14

11
%
 
Other Income
23

 
22

 
28

 
24

 
20

 
3

 
15
%
 
73

 
73

 
—

—
%
 
Total Other Income
498

 
520

 
458

 
505

 
501

 
(3
)
 
(1
%)
 
1,476

 
1,450

 
26

2
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue Net of Interest Expense
2,900

 
2,852

 
2,763

 
2,807

 
2,724

 
176

 
6
%
 
8,515

 
7,902

 
613

8
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for Loan Losses
799

 
787

 
809

 
800

 
742

 
57

 
8
%
 
2,395

 
2,235

 
160

7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Employee Compensation and Benefits
439

 
427

 
425

 
414

 
408

 
31

 
8
%
 
1,291

 
1,213

 
78

6
%
 
Marketing and Business Development
230

 
224

 
195

 
230

 
218

 
12

 
6
%
 
649

 
627

 
22

4
%
 
Information Processing & Communications
96

 
101

 
99

 
93

 
89

 
7

 
8
%
 
296

 
257

 
39

15
%
 
Professional Fees
189

 
183

 
167

 
190

 
166

 
23

 
14
%
 
539

 
482

 
57

12
%
 
Premises and Equipment
26

 
26

 
28

 
26

 
26

 
—

 
—
%
 
80

 
76

 
4

5
%
 
Other Expense
127

 
117

 
110

 
157

 
108

 
19

 
18
%
 
354

 
312

 
42

13
%
 
Total Other Expense
1,107

 
1,078

 
1,024

 
1,110

 
1,015

 
92

 
9
%
 
3,209

 
2,967

 
242

8
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income Before Income Taxes
994

 
987

 
930

 
897

 
967

 
27

 
3
%
 
2,911

 
2,700

 
211

8
%
 
Tax Expense
224

 
234

 
204

 
210

 
247

 
(23
)
 
(9
%)
 
662

 
645

 
17

3
%
 
Net Income

$770

 

$753

 

$726

 

$687

 

$720

 

$50

 
7
%
 

$2,249

 

$2,055

 

$194

9
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Income Allocated to Common Stockholders

$749

 

$747

 

$705

 

$681

 

$699

 

$50

 
7
%
 

$2,203

 

$2,008

 

$195

10
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Effective Tax Rate
22.5
%
 
23.8
%
 
21.9
%
 
23.5
%
 
25.5
%
 
 
 
 
 
22.7
%
 
23.9
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Interest Margin
10.43
%
 
10.47
%
 
10.46
%
 
10.35
%
 
10.28
%
 
15

 
bps
 
10.45
%
 
10.24
%
 
21

bps
 
Operating Efficiency
38.2
%
 
37.8
%
 
37.1
%
 
39.6
%
 
37.2
%
 
100

 
bps
 
37.7
%
 
37.5
%
 
20

bps
 
ROE
26
%
 
26
%
 
26
%
 
25
%
 
26
%
 
 
 
 
 
26
%
 
25
%
 
 
 
 
Capital Returned to Common Stockholders

$540

 

$571

 

$601

 

$578

 

$580

 

($40
)
 
(7
%)
 

$1,712

 

$1,920

 

($208
)
(11
%)
 
Payout Ratio
72
%
 
76
%
 
85
%
 
85
%
 
83
%
 


 


 
78
%
 
96
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ending Common Shares Outstanding
315

 
319

 
325

 
331

 
338

 
(23
)
 
(7
%)
 
315

 
338

 
(23
)
(7
%)
 
Weighted Average Common Shares Outstanding
317

 
322

 
328

 
335

 
341

 
(24
)
 
(7
%)
 
323

 
348

 
(25
)
(7
%)
 
Weighted Average Common Shares Outstanding (fully diluted)
317

 
323

 
328

 
335

 
342

 
(25
)
 
(7
%)
 
323

 
348

 
(25
)
(7
%)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
PER SHARE STATISTICS
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
 
 
 
 
 
 
Basic EPS

$2.36

 

$2.32

 

$2.15

 

$2.04

 

$2.05

 

$0.31

 
15
%
 

$6.83

 

$5.77

 

$1.06

18
%
 
Diluted EPS

$2.36

 

$2.32

 

$2.15

 

$2.03

 

$2.05

 

$0.31

 
15
%
 

$6.82

 

$5.77

 

$1.05

18
%
 
Common Dividends Declared Per Share

$0.44

 

$0.40

 

$0.40

 

$0.40

 

$0.40

 

$0.04

 
10
%
 

$1.24

 

$1.10

 

$0.14

13
%
 
Common Stock Price (period end)

$81.09

 

$77.59

 

$71.16

 

$58.98

 

$76.45

 

$4.64

 
6
%
 

$81.09

 

$76.45

 

$4.64

6
%
 
Book Value per share

$37.20

 

$35.97

 

$34.60

 

$33.58

 

$32.60

 

$4.60

 
14
%
 

$37.20

 

$32.60

 

$4.60

14
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Note: See Glossary of Financial Terms for definitions of financial terms
 
 
 
 
 
 
 
 




DISCOVER FINANCIAL SERVICES
 
BALANCE SHEET SUMMARY
 
(unaudited, in millions)
 
 
Quarter Ended
 
 
 
 
 
 
Sep 30, 2019
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Sep 30, 2019 vs. Sep 30, 2018
 
BALANCE SHEET SUMMARY
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and Investment Securities

$17,761

 

$19,934

 

$21,456

 

$18,515

 

$18,410

 

($649
)
 
(4
%)
 
Total Loan Receivables
92,493

 
90,229

 
88,743

 
90,512

 
86,894

 
5,599

 
6
%
 
Allowance for Loan Losses
(3,299
)
 
(3,202
)
 
(3,134
)
 
(3,041
)
 
(2,927
)
 
(372
)
 
(13
%)
 
Net Loan Receivables
89,194

 
87,027

 
85,609

 
87,471

 
83,967

 
5,227

 
6
%
 
Premises and Equipment, net
1,028

 
1,008

 
980

 
936

 
896

 
132

 
15
%
 
Goodwill and Intangible Assets, net
414

 
415

 
415

 
416

 
417

 
(3
)
 
(1
%)
 
Other Assets
2,389

 
2,323

 
2,260

 
2,215

 
2,152

 
237

 
11
%
 
Total Assets

$110,786

 

$110,707

 

$110,720

 

$109,553

 

$105,842

 

$4,944

 
5
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities & Stockholders' Equity
 

 
 

 
 

 
 

 
 

 
 

 
 

 
Direct to Consumer and Affinity Deposits

$52,298

 

$49,686

 

$47,730

 

$44,669

 

$43,411

 

$8,887

 
20
%
 
Brokered Deposits and Other Deposits
18,723

 
20,048

 
21,186

 
23,090

 
20,263

 
(1,540
)
 
(8
%)
 
Deposits
71,021

 
69,734

 
68,916

 
67,759

 
63,674

 
7,347

 
12
%
 
   Securitized Borrowings
12,820

 
14,214

 
15,351

 
16,917

 
15,715

 
(2,895
)
 
(18
%)
 
   Other Borrowings
11,634

 
10,949

 
10,925

 
10,311

 
11,283

 
351

 
3
%
 
Borrowings
24,454

 
25,163

 
26,276

 
27,228

 
26,998

 
(2,544
)
 
(9
%)
 
Accrued Expenses and Other Liabilities
3,594

 
4,317

 
4,269

 
3,436

 
4,154

 
(560
)
 
(13
%)
 
Total Liabilities
99,069

 
99,214

 
99,461

 
98,423

 
94,826

 
4,243

 
4
%
 
Total Equity
11,717

 
11,493

 
11,259

 
11,130

 
11,016

 
701

 
6
%
 
Total Liabilities and Stockholders' Equity

$110,786

 

$110,707

 

$110,720

 

$109,553

 

$105,842

 

$4,944

 
5
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
LIQUIDITY
 

 
 

 
 

 
 

 
 

 
 

 
 

 
Liquidity Portfolio

$16,732

 

$17,283

 

$20,050

 

$15,923

 

$16,370

 
362

 
2
%
 
Undrawn Credit Facilities 1
39,355

 
38,466

 
37,870

 
36,986

 
36,257

 
3,098

 
9
%
 
Total Liquidity

$56,087

 

$55,749

 

$57,920

 

$52,909

 

$52,627

 

$3,460

 
7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1  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
 
BALANCE SHEET STATISTICS
 
(unaudited, in millions)
 
 
Quarter Ended
 
 
 
 
 
 
Sep 30, 2019
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Sep 30, 2019 vs. Sep 30, 2018
 
BALANCE SHEET STATISTICS
 

 
 

 
 

 
 

 
 

 
 

 
 

 
Total Common Equity

$11,154

 

$10,930

 

$10,696

 

$10,567

 

$10,453

 

$701

 
7
%
 
Total Common Equity/Total Assets
10.1
%
 
9.9
%
 
9.7
%
 
9.6
%
 
9.9
%
 
 
 
 
 
Total Common Equity/Net Loans
12.5
%
 
12.6
%
 
12.5
%
 
12.1
%
 
12.4
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Tangible Assets

$110,372

 

$110,292

 

$110,305

 

$109,137

 

$105,425

 

$4,947

 
5
%
 
Tangible Common Equity 1

$10,740

 

$10,515

 

$10,281

 

$10,151

 

$10,036

 

$704

 
7
%
 
Tangible Common Equity/Tangible Assets 1
9.7
%
 
9.5
%
 
9.3
%
 
9.3
%
 
9.5
%
 
 
 
 
 
Tangible Common Equity/Net Loans 1
12.0
%
 
12.1
%
 
12.0
%
 
11.6
%
 
12.0
%
 
 
 
 
 
Tangible Common Equity per share  1

$34.10

 

$32.91

 

$31.60

 

$30.63

 

$29.70

 

$4.40

 
15
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
REGULATORY CAPITAL RATIOS
Basel III Transition
 
 

 
 

 
Total Risk Based Capital Ratio
13.7
%
 
13.7
%
 
13.9
%
 
13.5
%
 
13.9
%
 
 

 
 

 
Tier 1 Risk Based Capital Ratio
12.0
%
 
12.0
%
 
12.1
%
 
11.7
%
 
12.1
%
 
 

 
 

 
Tier 1 Leverage Ratio
10.3
%
 
10.2
%
 
10.0
%
 
10.1
%
 
10.4
%
 
 

 
 

 
Common Equity Tier 1 Capital Ratio
11.4
%
 
11.4
%
 
11.5
%
 
11.1
%
 
11.4
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Note: See Glossary of Financial Terms for definitions of financial terms
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 





DISCOVER FINANCIAL SERVICES
AVERAGE BALANCE SHEET
(unaudited, in millions)
 
Quarter Ended
 
 

 
 

 
Sep 30, 2019
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Sep 30, 2019 vs. Sep 30, 2018
AVERAGE BALANCES
 

 
 

 
 

 
 

 
 

 
 

 
 

Assets
 

 
 

 
 

 
 

 
 

 
 

 
 

Cash and Investment Securities

$17,215

 

$18,906

 

$18,417

 

$17,660

 

$16,474

 

$741

 
4
%
Restricted Cash
737

 
888

 
804

 
609

 
638

 
99

 
16
%
Credit Card Loans
73,248

 
71,492

 
71,363

 
70,563

 
68,613

 
4,635

 
7
%
Private Student Loans
9,459

 
9,464

 
9,654

 
9,344

 
9,158

 
301

 
3
%
Personal Loans
7,522

 
7,419

 
7,468

 
7,540

 
7,460

 
62

 
1
%
Other Loans
1,116

 
983

 
868

 
760

 
624

 
492

 
79
%
Total Loans
91,345

 
89,358

 
89,353

 
88,207

 
85,855

 
5,490

 
6
%
Total Interest Earning Assets
109,297

 
109,152

 
108,574

 
106,476

 
102,967

 
6,330

 
6
%
Allowance for Loan Losses
(3,198
)
 
(3,133
)
 
(3,040
)
 
(2,924
)
 
(2,827
)
 
(371
)
 
(13
%)
Other Assets
4,674

 
4,539

 
4,455

 
4,520

 
4,377

 
297

 
7
%
Total Assets

$110,773

 

$110,558

 

$109,989

 

$108,072

 

$104,517

 

$6,256

 
6
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholders' Equity
 

 
 

 
 

 
 

 
 

 
 

 
 

Direct to Consumer and Affinity Deposits

$50,497

 

$48,211

 

$45,841

 

$43,514

 

$42,498

 

$7,999

 
19
%
Brokered Deposits and Other Deposits
19,132

 
20,213

 
21,799

 
21,574

 
19,939

 
(807
)
 
(4
%)
Total Interest-bearing Deposits
69,629

 
68,424

 
67,640

 
65,088

 
62,437

 
7,192

 
12
%
Short-term Borrowings
1

 
—

 
1

 
2

 
3

 
(2
)
 
(67
%)
Securitized Borrowings
13,719

 
15,179

 
15,865

 
16,427

 
16,141

 
(2,422
)
 
(15
%)
Other Long-term Borrowings
11,047

 
10,932

 
10,711

 
10,756

 
10,351

 
696

 
7
%
Total Interest-bearing Liabilities
94,396

 
94,535

 
94,217

 
92,273

 
88,932

 
5,464

 
6
%
Other Liabilities & Stockholders' Equity
16,377

 
16,023

 
15,772

 
15,799

 
15,585

 
792

 
5
%
Total Liabilities and Stockholders' Equity

$110,773

 

$110,558

 

$109,989

 

$108,072

 

$104,517

 

$6,256

 
6
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
AVERAGE YIELD
 

 
 

 
 

 
 

 
 

 
 

 
 

Assets
 

 
 

 
 

 
 

 
 

 
 

 
 

Cash and Investment Securities
2.26
%
 
2.46
%
 
2.51
%
 
2.35
%
 
2.01
%
 
25

 
bps
Restricted Cash
2.11
%
 
2.32
%
 
2.35
%
 
2.28
%
 
1.92
%
 
19

 
bps
Credit Card Loans
13.35
%
 
13.44
%
 
13.42
%
 
13.20
%
 
13.06
%
 
29

 
bps
Private Student Loans
8.54
%
 
8.59
%
 
8.63
%
 
8.31
%
 
8.19
%
 
35

 
bps
Personal Loans
13.17
%
 
13.02
%
 
12.86
%
 
12.76
%
 
12.66
%
 
51

 
bps
Other Loans
6.72
%
 
6.83
%
 
6.85
%
 
6.57
%
 
6.38
%
 
34

 
bps
Total Loans
12.76
%
 
12.82
%
 
12.79
%
 
12.59
%
 
12.45
%
 
31

 
bps
Total Interest Earning Assets
11.03
%
 
10.94
%
 
10.97
%
 
10.83
%
 
10.72
%
 
31

 
bps
 
 
 
 
 
 
 
 
 
 
 
 
 
 
AVERAGE RATES
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholders' Equity
 

 
 

 
 

 
 

 
 

 
 

 
 

Direct to Consumer and Affinity Deposits
2.16
%
 
2.20
%
 
2.15
%
 
2.00
%
 
1.88
%
 
28

 
bps
Brokered Deposits and Other Deposits
2.73
%
 
2.71
%
 
2.67
%
 
2.58
%
 
2.51
%
 
22

 
bps
Total Interest-bearing Deposits
2.32
%
 
2.35
%
 
2.32
%
 
2.20
%
 
2.08
%
 
24

 
bps
Short-term Borrowings
2.18
%
 
2.59
%
 
2.59
%
 
2.42
%
 
2.09
%
 
9

 
bps
Securitized Borrowings
2.95
%
 
3.01
%
 
3.05
%
 
2.87
%
 
2.71
%
 
24

 
bps
Other Long-term Borrowings
4.64
%
 
4.75
%
 
4.81
%
 
4.65
%
 
4.56
%
 
8

 
bps
Total Interest-bearing Liabilities
2.68
%
 
2.73
%
 
2.72
%
 
2.60
%
 
2.49
%
 
19

 
bps
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Interest Margin
10.43
%
 
10.47
%
 
10.46
%
 
10.35
%
 
10.28
%
 
15

 
bps
Net Yield on Interest-earning Assets
8.72
%
 
8.57
%
 
8.61
%
 
8.57
%
 
8.57
%
 
15

 
bps
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Note: See Glossary of Financial Terms for definitions of financial terms




DISCOVER FINANCIAL SERVICES
 
 
 
 
 
 
 
 
 
 
 
LOAN STATISTICS
 
 
 
 
 
 
 
 
 
 
 
(unaudited, in millions)
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 

 
 

 
Nine Months Ended
 
 
 
 
 
 
 
 
Sep 30, 2019
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Sep 30, 2019 vs. Sep 30, 2018
 
Sep 30, 2019
 
Sep 30, 2018
 
2019 vs. 2018
 
 
 
 
TOTAL LOAN RECEIVABLES
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
 
 
 
 
 
 
 
 
 
Ending Loans 1, 2

$92,493

 

$90,229

 

$88,743

 

$90,512

 

$86,894

 

$5,599

 
6
%
 

$92,493

 

$86,894

 

$5,599

6
%
 
 
 
 
Average Loans 1, 2

$91,345

 

$89,358

 

$89,353

 

$88,207

 

$85,855

 

$5,490

 
6
%
 

$90,026

 

$84,262

 

$5,764

7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Yield
12.76
%
 
12.82
%
 
12.79
%
 
12.59
%
 
12.45
%
 
31

 
bps
 
12.79
%
 
12.32
%
 
47

bps
 
 
 
 
Gross Principal Charge-off Rate
3.87
%
 
4.03
%
 
4.02
%
 
3.77
%
 
3.63
%
 
24

 
bps
 
3.97
%
 
3.72
%
 
25

bps
 
 
 
 
Gross Principal Charge-off Rate excluding PCI Loans 3
3.93
%
 
4.10
%
 
4.10
%
 
3.85
%
 
3.71
%
 
22

 
bps
 
4.04
%
 
3.80
%
 
24

bps
 
 
 
 
Net Principal Charge-off Rate
3.05
%
 
3.22
%
 
3.25
%
 
3.08
%
 
2.97
%
 
8

 
bps
 
3.17
%
 
3.06
%
 
11

bps
 
 
 
 
Net Principal Charge-off Rate excluding PCI Loans 3
3.09
%
 
3.27
%
 
3.31
%
 
3.14
%
 
3.03
%
 
6

 
bps
 
3.22
%
 
3.13
%
 
9

bps
 
 
 
 
Delinquency Rate (30 or more days) excluding PCI Loans 3
2.32
%
 
2.18
%
 
2.28
%
 
2.31
%
 
2.22
%
 
10

 
bps
 
2.32
%
 
2.22
%
 
10

bps
 
 
 
 
Delinquency Rate (90 or more days) excluding PCI Loans 3
1.06
%
 
1.04
%
 
1.10
%
 
1.08
%
 
1.00
%
 
6

 
bps
 
1.06
%
 
1.00
%
 
6

bps
 
 
 
 
Gross Principal Charge-off Dollars

$891

 

$898

 

$887

 

$839

 

$785

 

$106

 
14
%
 

$2,676

 

$2,343

 

$333

14
%
 
 
 
 
Net Principal Charge-off Dollars

$702

 

$718

 

$715

 

$686

 

$642

 

$60

 
9
%
 

$2,135

 

$1,926

 

$209

11
%
 
 
 
 
Net Interest and Fee Charge-off Dollars

$156

 

$158

 

$158

 

$142

 

$135

 

$21

 
16
%
 

$472

 

$409

 

$63

15
%
 
 
 
 
Loans Delinquent 30 or more days 3

$2,114

 

$1,939

 

$1,988

 

$2,049

 

$1,894

 

$220

 
12
%
 

$2,114

 

$1,894

 

$220

12
%
 
 
 
 
Loans Delinquent 90 or more days 3

$968

 

$922

 

$959

 

$961

 

$854

 

$114

 
13
%
 

$968

 

$854

 

$114

13
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Allowance for Loan Loss (period end)

$3,299

 

$3,202

 

$3,134

 

$3,041

 

$2,927

 

$372

 
13
%
 

$3,299

 

$2,927

 

$372

13
%
 
 
 
 
Reserve Change Build/ (Release) 4

$97

 

$69

 

$94

 

$114

 

$100

 

($3
)
 


 

$260

 

$309

 

($49
)


 
 
 
 
Reserve Rate
3.57
%
 
3.55
%
 
3.53
%
 
3.36
%
 
3.37
%
 
20

 
bps
 
3.57
%
 
3.37
%
 
20

bps
 
 
 
 
Reserve Rate Excluding PCI Loans 3
3.59
%
 
3.58
%
 
3.57
%
 
3.39
%
 
3.41
%
 
18

 
bps
 
3.59
%
 
3.41
%
 
18

bps
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CREDIT CARD LOANS
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
 
 
 
 
 
 
 
 
 
Ending Loans

$73,968

 

$72,393

 

$70,789

 

$72,876

 

$69,253

 

$4,715

 
7
%
 

$73,968

 

$69,253

 

$4,715

7
%
 
 
 
 
Average Loans

$73,248

 

$71,492

 

$71,363

 

$70,563

 

$68,613

 

$4,635

 
7
%
 

$72,041

 

$67,073

 

$4,968

7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Yield
13.35
%
 
13.44
%
 
13.42
%
 
13.20
%
 
13.06
%
 
29

 
bps
 
13.41
%
 
12.93
%
 
48

bps
 
 
 
 
Gross Principal Charge-off Rate
4.25
%
 
4.43
%
 
4.40
%
 
4.01
%
 
3.90
%
 
35

 
bps
 
4.36
%
 
4.03
%
 
33

bps
 
 
 
 
Net Principal Charge-off Rate
3.32
%
 
3.49
%
 
3.50
%
 
3.23
%
 
3.14
%
 
18

 
bps
 
3.43
%
 
3.27
%
 
16

bps
 
 
 
 
Delinquency Rate (30 or more days)
2.50
%
 
2.34
%
 
2.45
%
 
2.43
%
 
2.32
%
 
18

 
bps
 
2.50
%
 
2.32
%
 
18

bps
 
 
 
 
Delinquency Rate (90 or more days)
1.21
%
 
1.18
%
 
1.26
%
 
1.22
%
 
1.12
%
 
9

 
bps
 
1.21
%
 
1.12
%
 
9

bps
 
 
 
 
Gross Principal Charge-off Dollars

$784

 

$789

 

$774

 

$713

 

$674

 

$110

 
16
%
 

$2,347

 

$2,021

 

$326

16
%
 
 
 
 
Net Principal Charge-off Dollars

$611

 

$623

 

$616

 

$575

 

$543

 

$68

 
13
%
 

$1,850

 

$1,638

 

$212

13
%
 
 
 
 
Loans Delinquent 30 or more days

$1,847

 

$1,692

 

$1,731

 

$1,772

 

$1,608

 

$239

 
15
%
 

$1,847

 

$1,608

 

$239

15
%
 
 
 
 
Loans Delinquent 90 or more days

$897

 

$857

 

$891

 

$887

 

$777

 

$120

 
15
%
 

$897

 

$777

 

$120

15
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Allowance for Loan Loss (period end)

$2,799

 

$2,691

 

$2,622

 

$2,528

 

$2,424

 

$375

 
15
%
 

$2,799

 

$2,424

 

$375

15
%
 
 
 
 
Reserve Change Build/ (Release)

$108

 

$69

 

$94

 

$104

 

$90

 

$18

 


 

$271

 

$277

 

($6
)


 
 
 
 
Reserve Rate
3.78
%
 
3.72
%
 
3.70
%
 
3.47
%
 
3.50
%
 
28

 
bps
 
3.78
%
 
3.50
%
 
28

bps
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Discover Card Volume

$41,168

 

$39,935

 

$36,386

 

$40,655

 

$39,414

 

$1,754

 
4
%
 

$117,489

 

$112,171

 

$5,318

5
%
 
 
 
 
Discover Card Sales Volume

$37,432

 

$36,664

 

$32,899

 

$37,208

 

$35,896

 

$1,536

 
4
%
 

$106,995

 

$101,823

 

$5,172

5
%
 
 
 
 
Rewards Rate
1.38
%
 
1.25
%
 
1.35
%
 
1.28
%
 
1.31
%
 
7

 
bps
 
1.33
%
 
1.30
%
 
3

bps
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1  Total Loans includes Home Equity 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
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4  Allowance for loan loss includes the net change in reserves on PCI pools having no remaining non-accretable difference which does not impact the reserve change build/(release) in provision for loan losses
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Note: See Glossary of Financial Terms for definitions of financial terms
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 




DISCOVER FINANCIAL SERVICES
 
 
 
 
 
 
 
LOAN STATISTICS
 
 
 
 
 
 
 
(unaudited, in millions)
 
 
 
 
 
 
 
 
Quarter Ended
 
 

 
 

 
Nine Months Ended
 
 
 
 
Sep 30, 2019
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Sep 30, 2019 vs. Sep 30, 2018
 
Sep 30, 2019
 
Sep 30, 2018
 
2019 vs. 2018
PRIVATE STUDENT LOANS
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
 
 
 
 
 
Ending Loans (excluding PCI)

$8,395

 

$7,943

 

$8,071

 

$7,728

 

$7,668

 

$727

 
9
%
 

$8,395

 

$7,668

 

$727

9
%
Ending PCI Loans 1
1,341

 
1,432

 
1,531

 
1,637

 
1,735

 
(394
)
 
(23
%)
 
1,341

 
1,735

 
(394
)
(23
%)
Ending Loans

$9,736

 

$9,375

 

$9,602

 

$9,365

 

$9,403

 

$333

 
4
%
 

$9,736

 

$9,403

 

$333

4
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Yield
8.54
%
 
8.59
%
 
8.63
%
 
8.31
%
 
8.19
%
 
35

 
bps
 
8.58
%
 
8.04
%
 
54

bps
Net Principal Charge-off Rate
0.59
%
 
0.61
%
 
0.66
%
 
0.86
%
 
0.96
%
 
(37
)
 
bps
 
0.62
%
 
0.93
%
 
(31
)
bps
Net Principal Charge-off Rate excluding PCI Loans 2
0.69
%
 
0.73
%
 
0.79
%
 
1.05
%
 
1.19
%
 
(50
)
 
bps
 
0.73
%
 
1.17
%
 
(44
)
bps
Delinquency Rate (30 or more days) excluding PCI Loans 2
1.78
%
 
1.67
%
 
1.76
%
 
2.00
%
 
2.13
%
 
(35
)
 
bps
 
1.78
%
 
2.13
%
 
(35
)
bps
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Reserve Rate
1.51
%
 
1.79
%
 
1.75
%
 
1.80
%
 
1.80
%
 
(29
)
 
bps
 
1.51
%
 
1.80
%
 
(29
)
bps
Reserve Rate excluding PCI Loans 2
1.47
%
 
1.80
%
 
1.78
%
 
1.85
%
 
1.87
%
 
(40
)
 
bps
 
1.47
%
 
1.87
%
 
(40
)
bps
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
PERSONAL LOANS
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
 
 
 
 
 
Ending Loans

$7,596

 

$7,414

 

$7,428

 

$7,454

 

$7,545

 

$51

 
1
%
 

$7,596

 

$7,545

 

$51

1
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Yield
13.17
%
 
13.02
%
 
12.86
%
 
12.76
%
 
12.66
%
 
51

 
bps
 
13.02
%
 
12.55
%
 
47

bps
Net Principal Charge-off Rate
3.99
%
 
4.33
%
 
4.53
%
 
4.49
%
 
4.09
%
 
(10
)
 
bps
 
4.28
%
 
4.03
%
 
25

bps
Delinquency Rate (30 or more days)
1.49
%
 
1.49
%
 
1.51
%
 
1.60
%
 
1.57
%
 
(8
)
 
bps
 
1.49
%
 
1.57
%
 
(8
)
bps
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Reserve Rate
4.59
%
 
4.56
%
 
4.55
%
 
4.53
%
 
4.28
%
 
31

 
bps
 
4.59
%
 
4.28
%
 
31

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 AND VOLUME STATISTICS
 
 
 
 
 
 
 
 
(unaudited, in millions)
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
 
 
 
Nine Months Ended
 
 
 
 
 
Sep 30, 2019
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
 
Sep 30, 2019 vs. Sep 30, 2018
 
Sep 30, 2019
 
Sep 30, 2018
 
2019 vs. 2018
 
DIRECT BANKING
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Income

$3,040

 

$2,976

 

$2,937

 

$2,906

 

$2,781

 

$259

 
9
%
 

$8,953

 

$7,986

 

$967

12
%
 
Interest Expense
638

 
645

 
632

 
605

 
558

 
80

 
14
%
 
1,915

 
1,534

 
381

25
%
 
Net Interest Income
2,402

 
2,331

 
2,305

 
2,301

 
2,223

 
179

 
8
%
 
7,038

 
6,452

 
586

9
%
 
Other Income
409

 
436

 
372

 
432

 
421

 
(12
)
 
(3
%)
 
1,217

 
1,213

 
4

—
%
 
Revenue Net of Interest Expense
2,811

 
2,767

 
2,677

 
2,733

 
2,644

 
167

 
6
%
 
8,255

 
7,665

 
590

8
%
 
Provision for Loan Losses
799

 
787

 
809

 
800

 
742

 
57

 
8
%
 
2,395

 
2,235

 
160

7
%
 
Total Other Expense
1,069

 
1,039

 
989

 
1,059

 
979

 
90

 
9
%
 
3,097

 
2,859

 
238

8
%
 
Income Before Income Taxes

$943

 

$941

 

$879

 

$874

 

$923

 

$20

 
2
%
 

$2,763

 

$2,571

 

$192

7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Interest Margin
10.43
%
 
10.47
%
 
10.46
%
 
10.35
%
 
10.28
%
 
15

 
bps
 
10.45
%
 
10.24
%
 
21

bps
 
Pretax Return on Loan Receivables
4.09
%
 
4.23
%
 
3.99
%
 
3.93
%
 
4.27
%
 
(18
)
 
bps
 
4.10
%
 
4.08
%
 
2

bps
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Allowance for Loan Loss (period end)

$3,298

 

$3,200

 

$3,133

 

$3,039

 

$2,920

 

$378

 
13
%
 

$3,298

 

$2,920

 

$378

13
%
 
Reserve Change Build/ (Release) 1

$98

 

$69

 

$94

 

$120

 

$100

 

($2
)
 
 
 

$261

 

$309

 

($48
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
PAYMENT SERVICES
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
 
 
 
 
 
 
Interest Income

$—

 

$1

 

$—

 

$1

 

$—

 

$—

 
NM

 

$1

 

$—

 

$1

NM

 
Interest Expense
—

 
—

 
—

 
—

 
—

 
—

 
NM

 
—

 
—

 
—

NM

 
Net Interest Income
—

 
1

 
—

 
1

 
—

 
—

 
NM

 
1

 
—

 
1

NM

 
Other Income
89

 
84

 
86

 
73

 
80

 
9

 
11
%
 
259

 
237

 
22

9
%
 
Revenue Net of Interest Expense
89

 
85

 
86

 
74

 
80

 
9

 
11
%
 
260

 
237

 
23

10
%
 
Total Other Expense
38

 
39

 
35

 
51

 
36

 
2

 
6
%
 
112

 
108

 
4

4
%
 
Income Before Income Taxes

$51

 

$46

 

$51

 

$23

 

$44

 

$7

 
16
%
 

$148

 

$129

 

$19

15
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
TRANSACTIONS PROCESSED ON NETWORKS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Discover Network
710

 
671

 
605

 
663

 
642

 
68

 
11
 %
 
1,986

 
1,806

 
180

10
%
 
PULSE Network
1,220

 
1,183

 
1,132

 
1,169

 
1,151

 
69

 
6
 %
 
3,535

 
3,195

 
340

11
%
 
Total
1,930

 
1,854

 
1,737

 
1,832

 
1,793

 
137

 
8
 %
 
5,521

 
5,001

 
520

10
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NETWORK VOLUME
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
PULSE Network

$47,535

 

$47,389

 

$47,106

 

$47,082

 

$45,244

 

$2,291

 
5
 %
 

$142,030

 

$132,710

 

$9,320

7
%
 
Network Partners
6,656

 
5,950

 
5,663

 
4,680

 
5,113

 
1,543

 
30
%
 
18,269

 
14,268

 
4,001

28
%
 
Diners Club International 2
8,386

 
8,472

 
8,278

 
8,700

 
8,370

 
16

 
—
 %
 
25,136

 
25,177

 
(41
)
0
%
 
Total Payment Services
62,577

 
61,811

 
61,047

 
60,462

 
58,727

 
3,850

 
7
 %
 
185,435

 
172,155

 
13,280

8
%
 
Discover Network - Proprietary
38,722

 
37,891

 
34,051

 
38,502

 
36,642

 
2,080

 
6
 %
 
110,664

 
105,363

 
5,301

5
%
 
Total

$101,299

 

$99,702

 

$95,098

 

$98,964

 

$95,369

 

$5,930

 
6
 %
 

$296,099

 

$277,518

 

$18,581

7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1  Allowance for loan loss includes the net change in reserves on PCI pools having no remaining non-accretable difference which does not impact the reserve change build/(release) in provision for loan losses
 
2  Volume is derived from data provided by licencees 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 - GLOSSARY OF FINANCIAL TERMS
 
 
 
 
Balance Sheet & Regulatory Capital Terms
Liquidity Portfolio represents cash and cash equivalents (excluding cash-in-process) and other investments
 
 
 
 
Regulatory Capital Ratios at September 30, 2019 are preliminary
•
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
•
Common Equity Tier 1 Capital Ratio represents common equity tier 1 capital divided by risk weighted assets
 
 
 
 
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
 
 
 
 
Tangible Common Equity/Net Loans, a non-GAAP measure, represents TCE divided by total loans less the allowance for loan loss (period end)
 
 
 
 
Tangible Common Equity per Share, a non-GAAP measure, represents TCE divided by ending common shares outstanding
 
 
 
 
Tangible Common Equity/Tangible Assets, a non-GAAP measure, represents TCE 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)
 
 
 
 
Credit Related Terms
Delinquency Rate (30 or more days) represents loans delinquent thirty days or more divided by ending loans (total or respective product loans, as appropriate)
 
 
 
 
Delinquency Rate (90 or more days) represents loans delinquent ninety days or more divided by ending loans (total or respective product loans, as appropriate)
 
 
 
 
Gross Principal Charge-off Rate represents gross principal charge-off dollars (annualized) divided by average loans for the reporting period (total or respective product loans, as appropriate)
 
 
 
 
Net Principal Charge-off Rate represents net principal charge-off dollars (annualized) divided by average loans for the reporting period (total or respective product loans, as appropriate)
 
 
 
 
Reserve Rate represents the allowance for loan losses divided by total loans (total or respective product loans, as appropriate)
 
 
 
 
Earnings and Shareholder Return Terms
Book Value per share represents total equity divided by ending common shares outstanding
 
 
 
 
Capital Returned to Common Stockholders represents common stock dividends declared and treasury share repurchases, excluding common stock issued under employee benefit plans and stock based compensation
 
 
 
 
Earnings Per Share represents net income allocated to common stockholders divided by the weighted average common shares outstanding
 
 
 
 
Interest Yield represents interest income on loan receivables (annualized) divided by average loans for the reporting period (total or respective product loans, as appropriate)
 
 
 
 
Net Income Allocated to Common Stockholders represents net income less preferred stock dividends and income allocated to participating securities
 
 
 
 
Net Interest Margin represents net interest income (annualized) divided by average total loans for the period
 
 
 
 
Net Yield on Interest Earning Assets represents net interest income (annualized) divided by average total interest earning assets for the period
 
 
 
 
Operating Efficiency represents total other expense divided by revenue net of interest expense
 
 
 
 
Pretax Return on Loan Receivables represents income before income taxes (annualized) divided by total average loans for the period
 
 
 
 
Payout Ratio represents capital returned to common stockholders divided by net income allocated to common stockholders
 
 
 
 
Return on Equity represents net income (annualized) divided by average total equity for the reporting period
 
 
 
 
Rewards Rate represents Credit Card rewards cost divided by Discover Card sales volume
 
 
 
 
Volume Terms
Discover Card Sales Volume represents Discover card activity related to sales net of returns
 
 
 
 
Discover Card Volume represents Discover card activity related to sales net of returns, balance transfers, cash advances and other activity
 
 
 
 
Discover Network Proprietary Volume represents gross Discover Card sales volume on the Discover Network




DISCOVER FINANCIAL SERVICES
RECONCILIATION OF GAAP TO NON-GAAP DATA
(unaudited, in millions)
 
Quarter Ended
 
Sep 30, 2019
 
Jun 30, 2019
 
Mar 31, 2019
 
Dec 31, 2018
 
Sep 30, 2018
GAAP Total Common Equity

$11,154

 

$10,930

 

$10,696

 

$10,567

 

$10,453

Less: Goodwill
(255
)
 
(255
)
 
(255
)
 
(255
)
 
(255
)
Less: Intangibles
(159
)
 
(160
)
 
(160
)
 
(161
)
 
(162
)
Tangible Common Equity 1

$10,740

 

$10,515

 

$10,281

 

$10,151

 

$10,036

 
 
 
 
 
 
 
 
 
 
GAAP Book Value Per Share

$37.20

 

$35.97

 

$34.60

 

$33.58

 

$32.60

Less: Goodwill
(0.80
)
 
(0.80
)
 
(0.78
)
 
(0.77
)
 
(0.76
)
Less: Intangibles
(0.51
)
 
(0.50
)
 
(0.49
)
 
(0.48
)
 
(0.48
)
   Less: Preferred Stock
(1.79
)
 
(1.76
)
 
(1.73
)
 
(1.70
)
 
(1.66
)
Tangible Common Equity Per Share

$34.10

 

$32.91

 

$31.60

 

$30.63

 

$29.70

 
 
 
 
 
 
 
 
 
 
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 users of this information are advised 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
 
Note: See Glossary of Financial Terms for definitions of financial terms