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Key regulator approves merger of Capital One and Discover, paving the way for a new biggest credit card company

  • CNN
  • April 18, 2025
New York

CNN

 — 

There could very soon be a new biggest credit card company in the United States.

Capital One received conditional approval from the Office of the Comptroller of the Currency to acquire and merge with Discover Financial Services, the agency announced Friday.

The move helps pave the way for the merger's completion, pending the approval of the Federal Reserve's Board of Governors. The deal received the green light from the Justice Department's antitrust arm earlier this month.

The all-stock deal, first announced over a year ago, would give Capital One a major leg up against competing credit card-issuing banks such as JPMorgan Chase (JPM), Bank of America (BAC) and Citigroup (C), which don't process transactions themselves.

It would also give Capital One a new source of revenue from the merchant fees it collects.

For existing Discover customers, the move could increase merchant acceptance rates. But there's also a risk that they could face higher credit card interest rates.

Compared to other major credit card issuers, Capital One has historically catered to customers with credit scores in the 600s range, which is considered subprime. Given these borrowers are considered riskier, they tend to get charged higher interest rates compared to higher-scoring individuals.

This is a developing story and will be updated.

https://edition.cnn.com/2025/04/18/business/capital-one-discover-merger-conditional-approval/index.html