Discover Receives Non-Objection from Federal Reserve with Respect to Proposed Capital Actions Through June 30, 2019

Discover Financial Services (NYSE: DFS) today announced that the Board of Governors of the Federal Reserve System notified Discover that it has no objections to the capital actions through June 30, 2019 as set forth in the company’s capital plan. The plan includes an increase in the company’s next quarterly dividend from $0.35 to $0.40 per share of common stock and share repurchases of up to $1.85 billion during the four quarters ending June 30, 2019.

The board of directors is scheduled to approve the dividend increase and a new share repurchase program at its July meeting. The company’s planned new repurchase program will replace the existing program.

The timing and exact amount of repurchases will be consistent with the company’s capital plan and will be based on market conditions and other factors, subject to legal or regulatory restrictions and approvals.

The results of Discover’s company-run stress test conducted in accordance with the Dodd-Frank Wall Street Reform and Consumer Protection Act, including Discover’s estimates of pre-provision net revenue, other revenue, loan and other losses, net income before taxes and regulatory capital ratios for both Discover Financial Services and Discover Bank, as well as additional information on the methodologies used in conducting the stress test, may be found on the Investor Relations page of Discover’s corporate website at www.discover.com/company under Disclosures.

About Discover

Discover Financial Services (NYSE: DFS) is a direct banking and payment services company with one of the most recognized brands in U.S. financial services. Since its inception in 1986, the company has become one of the largest card issuers in the United States. The company issues the Discover card, America's cash rewards pioneer, and offers private student loans, personal loans, home equity loans, checking and savings accounts and certificates of deposit through its direct banking business. It operates the Discover Network, with millions of merchant and cash access locations; PULSE, one of the nation's leading ATM/debit networks; and Diners Club International, a global payments network with acceptance in 190 countries and territories. For more information, visit www.discover.com/company.

This press release contains forward-looking statements. You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they are made, which reflect management’s estimates, projections, expectations or beliefs at that time, and which are subject to significant risks and uncertainties that may cause actual results to differ materially. The amount and timing of any future dividends and share repurchases are subject to the discretion of the company’s board of directors and will depend upon the company’s results of operations, financial condition, cash requirements, future prospects, market conditions, capital requirements, applicable law and regulations (including federal securities laws and federal banking regulations) and other factors, and may be subject to regulatory approval or conditions. Additional factors impacting dividends and share repurchases can be found in "Business - Supervision and Regulation", “Risk Factors” and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the company's annual report on Form 10-K for the year ended December 31, 2017, and under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2018, which are filed with the SEC and available at the SEC's website (www.sec.gov). The Company does not undertake to update or revise forward-looking statements as more information becomes available.

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