Discover Posts Record 1Q/11 Net Income
Discover posted 1Q/11 net income of $465 million, compared to a $104 million net loss in the year ago quarter. This was thanks in part to card sales volume up 7% to $24 billion; credit having improved and with the credit card net charge-off rate having declined sequentially 99 basis points to 5.96%; credit card loans over 30 days delinquent having declined 47 basis points to 3.59%; payment services’ pretax income up 16% from the prior year; and payment services transaction volume up 21% since the year ago quarter to $43 billion.
Credit card loans ended the quarter at $44.3 billion, a 3% decline from the prior year, while net interest income increased $46 million from the prior quarter. Payment Services pretax income of $43 million in the quarter was up $6 million by 16% from the year figure thanks to an $11 million increase in revenues. Payment Services dollar volume was a record $43.2 billion for the first quarter, up 21% from the prior year, driven by higher Diners Club International, third-party issuers volume and PULSE, which saw transactions up 29%.