UNITED STATES

SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

Form 8-K

Current Report

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): December 17, 2009

DISCOVER FINANCIAL SERVICES (Exact name of registrant as specified in its charter)

Commission File Number: 001-33378

2500 Lake Cook Road, Riverwoods, Illinois 60015 (Address of principal executive offices, including zip code)

(224) 405-0900 (Registrant’s telephone number, including area code)

N/A (Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Delaware 36-2517428

(State or other jurisdiction of incorporation)

(IRS Employer Identification No.)

� � � � Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

� � � � Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

� � � � Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

� � � � Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

On December 17, 2009, Discover Financial Services (the “Company”) released financial information with respect to the quarter and year ended November 30, 2009. A copy of the press release containing this information is attached hereto as Exhibit 99.1 and incorporated herein by reference. In addition, a copy of the Company's Financial Data Supplement for the quarter and year ended November 30, 2009 is attached hereto as Exhibit 99.2 and incorporated herein by reference.

The information contained in this Item 2.02 of this Current Report on Form 8-K, including Exhibit 99.1 and Exhibit 99.2, is furnished pursuant to Item 2.02 of Form 8-K and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except as shall be expressly stated by specific reference in such filing. Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit No. Description 99.1

Press Release of the Company dated December 17, 2009 containing financial information for the quarter and year ended November 30, 2009

99.2 Financial Data Supplement of the Company for the quarter and year ended November 30, 2009

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

DISCOVER FINANCIAL SERVICES Dated: December 17, 2009 By: /s/ D. Christopher Greene Name: D. Christopher Greene

Title: Vice President, Assistant General Counsel and Assistant Secretary

EXHIBIT INDEX

Exhibit No. Description 99.1

Press Release of the Company dated December 17, 2009 containing financial information for the quarter and year ended November 30, 2009

99.2 Financial Data Supplement of the Company for the quarter and year ended November 30, 2009

Exhibit 99.1

DISCOVER FINANCIAL SERVICES REPORTS FOURTH QUARTER RESULTS:

NET INCOME OF $371 MILLION AND EARNINGS PER SHARE O F $0.63 Riverwoods, IL, Dec. 17, 2009 - Discover Financial Services (NYSE: DFS) today reported income for the quarter and year ended Nov. 30, 2009 as follows:

Fourth quarter income from continuing operations was $371 million, down 16% from the fourth quarter of 2008. After-tax income related to the Visa/MasterCard antitrust litigation settlement included in continuing after-tax earnings was approximately $285 million and $535 million in the fourth quarter of 2009 and 2008, respectively. Full year income from continuing operations was $1.3 billion, up 22% from last year. Income from continuing operations for full year 2009 and 2008 included $1.2 billion and $535 million (after-tax), respectively, related to the litigation settlement. Fourth Quarter Highlights

1 All references to financial information presented on a managed basis assume that loans that have been securitized were not sold and present financial information regarding these loans in a manner similar to the presentation of financial information regarding loans that have not been sold. Management believes it is useful for investors to consider the credit performance of the entire managed loan portfolio to understand the quality of loan originations and the related credit risks inherent in the owned portfolio and retained interests in securitization. For more information, and a detailed reconciliation, see the schedule titled “Reconciliation of GAAP to Managed Data” attached to this press release.

Continuing Operations Discontinued Operations Net Income

Earnings Diluted EPS Earnings Earnings Diluted EPS (millions) (millions) (millions) 4Q09 $371 $0.63 - $371 $0.63 4Q08 $444 $0.92 ($12) $432 $0.89 2009 $1,294 $2.42 - $1,294 $2.42 2008 $1,063 $2.20 ($135) $928 $1.92

• Managed 1 loans remained at approximately $51 billion. The student loan portfolio grew $513 million in the quarter while credit card loans decreased $670 million.

• The fourth-quarter managed net charge-off rate rose to 8.43% and the over 30 days delinquency rate rose to 5.31%.

• Discover Card sales volume declined 1% from the prior year to $22 billion.

• Third-Party Payments segment volume was $33 billion, a 2% decrease from the prior year.

“Discover's results this quarter reflect stronger than expected credit performance and our on-going investments to strengthen the Discover franchise,” said David Nelms, Discover’s chairman and chief executive officer. “We were very pleased with the stability of our sales volume, our expanded merchant acceptance and the continued growth of our direct-to-consumer banking business. For the full year we were profitable even excluding the antitrust settlement proceeds, and are closing out 2009 with strong capital levels and a strong foundation that positions us well for future growth.” Segment Results (Managed Basis): U.S. Card Pretax income was $575 million in the fourth quarter of 2009 as compared to $646 million for the fourth quarter of 2008. Managed loans ended the quarter at $51 billion, essentially flat compared to the prior year, as lower cardmember payments and growth in both student and personal loans were largely offset by lower balance transfer activity and sales volume. Sales volume declined 1% compared to the prior year, reflecting lower gas prices and a general decline in consumer spending. Balance transfer volume declined 66% from the prior year as the company reduced its marketing of promotional rate balance transfer offers. Net yield on loan receivables was 9.37%, an increase of 82 basis points from the prior year and a decrease of 53 basis points from the prior quarter. The net yield increased from the prior year as the rate on credit card balances declined less than the cost of funds, primarily due to higher interest rates on standard balances and a reduction in promotional rate balances. The net yield decreased from the prior quarter reflecting the impact of a decline in higher rate balances related to the implementation of the CARD Act, an increase in lower rate student loan balances and an increase in the liquidity reserve. The managed net charge-off rate increased to 8.43% for the fourth quarter of 2009, up 295 basis points and 4 basis points from the prior year and the prior quarter, respectively. The over 30 days delinquency rate on managed loans was 5.31%, up 75 basis points from the prior year and 21 basis points from the prior quarter. The increase in both the net charge-off rate and delinquency rate was due to higher levels of consumer bankruptcies and unemployment partially offset by a higher mix of student loans. The managed net charge-off rate for the first quarter of 2010 is expected to be between 8.4% and 8.9%. Provision for loan losses decreased $117 million, or 11%, from the prior year due to a lower reserve build, partially offset by higher net charge-offs. The allowance for loan losses increased $383 million from the prior year, but decreased $75 million from the prior quarter. The increase from the prior year reflects a 199 basis point increase in the reserve rate, partially offset by a $1.6 billion decrease in on-balance sheet loans primarily related to securitization activity. The decrease from the prior quarter reflects a $1.9 billion decline in the level of on-balance sheet loans in the quarter as a result of securitization activities partially offset by a 25 basis point increase in the reserve rate.

• Deposit balances originated through direct-to-consumer and affinity relationships were $12.6 billion, an increase of $2.4 billion from the prior quarter.

• Discover Bank issued $700 million of subordinated notes, increasing the company’s total regulatory capital.

Other income includes $472 million and $864 million in litigation settlement proceeds in the fourth quarter of 2009 and 2008, respectively. Excluding the settlement proceeds, other income increased $82 million from the prior year, primarily due to the revaluation of the interest-only strip receivable. The fourth quarter 2009 includes a $38 million unfavorable revaluation of the interest-only strip receivable compared to a $116 million unfavorable revaluation in the fourth quarter 2008. Expenses were down $18 million, or 3% from the prior year, reflecting the impact of cost containment initiatives, partially offset by costs associated with the global expansion initiative of $13 million and a $9 million charge related to a facility closure. The fourth quarter of 2008 included a $39 million benefit due to curtailment of the company’s pension plan. Third-Party Payments Pretax income of $24 million in the quarter was up $3 million from the prior year. Revenues were up $6 million reflecting an increase in transactions on the PULSE network, lower incentive payments and higher fee revenues. Expenses were up $2 million including a higher level of international marketing investments, partially offset by the impact of cost containment initiatives. Third-Party Payments dollar volume for the fourth quarter of $33 billion was down 2% from the prior year. However, the number of transactions on the PULSE network increased 5% to 677 million, due to increased transactions from new and existing clients, partially offset by the loss of volume from one large financial institution. Capital Markets Activity During the quarter, the company’s wholly-owned subsidiary, Discover Bank, raised approximately $700 million through a subordinated debt issuance, increasing tier 2 regulatory capital. In addition, the company’s securitization trust issued $1.3 billion of asset-backed securities through the TALF program. Dividends The company’s board declared a cash dividend of $0.02 per share of common stock, payable on Jan. 21, 2010, to stockholders of record at the close of business on Dec. 31, 2009. Adoption of Statement of Financial Accounting Standards No. 166 and 167 The company adopted Statement of Financial Accounting Standards No. 166 and 167 on Dec. 1, 2009, which requires the consolidation of its credit card securitization trusts. At adoption, the company added approximately $21.1 billion of assets, including a $2.1 billion addition to loan loss reserves, and approximately $22.4 billion of liabilities to its balance sheet. The net impact of the new accounting is a reduction to stockholders’ equity of $1.3 billion. The company estimates its pro-forma total and tier 1 regulatory capital ratios after adoption would be 16.0% and 13.3%, respectively.

Conference Call and Webcast Information The company will host a conference call to discuss its fourth quarter results on Thursday, Dec. 17, 2009, at 10 a.m. Central time. Interested parties can listen to the conference call via a live audio webcast at http://investorrelations.discoverfinancial.com. About Discover Discover Financial Services (NYSE: DFS) is a leading credit card issuer and electronic 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 operates the Discover card, America's cash rewards pioneer, and offers student and personal loans, as well as savings products such as certificates of deposit and money market accounts. Its payments businesses consist of 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 more than 185 countries and territories. For more information, visit www.discoverfinancial.com. Contacts: Investors: Craig Streem, 224-405-3575 craigstreem@discover.com Media: Jon Drummond, 224-405-1888 jondrummond@discover.com A financial summary follows. Financial, statistical, and business related information, as well as information regarding business and segment trends, is included in the financial supplement filed as Exhibit 99.2 to the company’s Form 8-K filed today with the Securities and Exchange Commission (“SEC”). Both the earnings release and the financial supplement are available online at the SEC’s website ( http://www.sec.gov ) and the company’s website (http://investorrelations.discoverfinancial.com). This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based upon the current beliefs and expectations of the company’s management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements. These forward-looking statements speak only as of the date of this press release, and there is no undertaking to update or revise them as more information becomes available. The following factors, among others, could cause actual results to differ materially from those set forth in the forward-looking statements: the actions and initiatives of current and potential competitors; our ability to manage credit risks and securitize our receivables; changes in economic variables, such as the availability of consumer credit, the housing market, energy costs, the number and size of personal bankruptcy filings, the rate of unemployment and the levels of consumer confidence and consumer debt; the level and volatility of equity prices, commodity prices and interest rates, currency values, investments, other market fluctuations and other market indices; the availability and cost of funding and capital; access to U.S. equity, debt and deposit markets; the ability to manage our liquidity risk; the impact of rating agency actions; losses in our investment portfolio; the ability to increase or sustain Discover card usage or attract new cardmembers and introduce new products or services; our ability to attract new merchants and maintain relationships with current merchants; our ability to successfully achieve interoperability among our networks and maintain relationships with network participants; material security breaches of key systems; unforeseen and catastrophic events; our reputation; the potential effects of technological changes; the effect of political, economic and market conditions and geopolitical events; unanticipated developments relating to lawsuits, investigations or similar matters; the impact of current, pending and future legislation, regulation and regulatory and legal actions, including new laws and rules limiting or modifying certain credit card practices, new laws and rules affecting securitizations, and legislation related to government programs to stabilize the financial markets; changes to accounting rules or the interpretations thereof; our ability to attract and retain employees; our ability to protect our intellectual property; the impact of any potential future acquisitions; investor sentiment; resolution of our dispute with Morgan Stanley; and the restrictions on our operations resulting from financing transactions. Additional factors that could cause the company’s results to differ materially from those described in the forward-looking statements can be found under “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 November 30, 2008 and Quarterly Reports on Form 10-Q for the quarters ended February 28, 2009, May 31, 2009, and August 31, 2009, which are filed with the SEC and available at the SEC's internet site (http://www.sec.gov).

Discover Financial Services Managed Basis 1 (unaudited, dollars in thousands) Quarter Ended Year Ended Nov 30, 2009 Aug 31, 2009 Nov 30, 2008 Nov 30, 2009 Nov 30, 2008 Earnings Summary 1

Interest Income 1 $ 1,585,690 $ 1,664,081 $ 1,682,267 $ 6,461,072 $ 6,545,829 Interest Expense 1 403,298 392,642 602,450 1,648,420 2,356,919

Net Interest Income 1 1,182,392 1,271,439 1,079,817 4,812,652 4,188,910 Other Income 1, 2 984,372 1,116,765 1,287,213 3,917,675 2,953,096 Revenue Net of Interest Expense 1 2,166,764 2,388,204 2,367,030 8,730,327 7,142,006 Provision for Loan Losses 1 989,009 924,427 1,105,971 4,358,341 3,068,604 Total Other Expense 578,507 523,838 594,082 2,222,096 2,415,797 Income Before Income Taxes 2 599,248 939,939 666,977 2,149,890 1,657,605 Tax Expense 228,560 362,485 223,336 855,554 594,692 Income From Continuing Operations 2 370,688 577,454 443,641 1,294,336 1,062,913 Discontinued Operations, Net of Tax 3 - - (11,306 ) - (135,163 ) Net Income 2,3 $ 370,688 $ 577,454 $ 432,335 $ 1,294,336 $ 927,750

Net Income Available to Common Stockholders $ 352,054 $ 559,387 $ 432,335 $ 1,241,081 $ 927,750

Pre-tax Income, U.S. Card 2 $ 575,477 $ 912,800 $ 646,427 $ 2,043,346 $ 1,576,194 Pre-tax Income, Third Party Payments $ 23,771 $ 27,139 $ 20,550 $ 106,544 $ 81,411 Per Share Statistics Diluted EPS from Continuing Operations 2, 4 $ 0.63 $ 1.07 $ 0.92 $ 2.42 $ 2.20 Balance Sheet Statistics 5 Total Assets - Managed 1 $ 72,978,435 $ 67,794,309 $ 65,620,476 $ 72,978,435 $ 65,620,476 Total Equity $ 8,466,755 $ 8,386,202 $ 5,915,823 $ 8,466,755 $ 5,915,823 Total Loans - Managed 1 $ 50,860,372 $ 50,903,845 $ 51,095,278 $ 50,860,372 $ 51,095,278 Average Total Loans - Managed 1 $ 50,590,846 $ 50,971,056 $ 50,707,090 $ 51,140,614 $ 49,011,148 Key Ratios Return on Managed Loan Receivables 1 2.94 % 4.49 % 3.52 % 2.53 % 2.17 % Managed Interest Yield 1 12.34 % 12.73 % 12.65 % 12.36 % 12.61 % Net Yield on Managed Loan Receivables 1 9.37 % 9.90 % 8.56 % 9.41 % 8.55 % Managed Net Principal Charge-off Rate 1 8.43 % 8.39 % 5.48 % 7.77 % 5.01 % Reserve Rate 7.44 % 7.19 % 5.45 % 7.44 % 5.45 % Reserve Rate (excluding guaranteed student loans) 6 7.87 % 7.45 % 5.48 % 7.87 % 5.48 % Managed Delinquency Rate (over 30 days) 1 5.31 % 5.10 % 4.56 % 5.31 % 4.56 % Managed Delinquency Rate (over 90 days) 1 2.78 % 2.60 % 2.17 % 2.78 % 2.17 % Total Discover Card Volume $ 23,335,440 $ 23,955,402 $ 25,318,553 $ 95,592,170 $ 105,734,055 Discover Card Sales Volume $ 21,903,694 $ 22,768,927 $ 22,025,264 $ 87,460,552 $ 92,239,779 Volume PULSE Network $ 24,667,926 $ 28,051,978 $ 25,033,235 $ 109,302,121 $ 106,012,108 Third-Party Issuers 1,522,269 1,446,308 1,538,013 5,671,555 6,398,579 Diners Club International 7 7,172,809 6,465,990 7,457,893 26,172,977 12,685,690

Total Third-Party Payments 33,363,004 35,964,276 34,029,141 141,146,653 125,096,377 Discover Network - Proprietary 8 22,712,600 23,579,434 22,875,272 90,688,997 95,688,443 Total $ 56,075,604 $ 59,543,710 $ 56,904,413 $ 231,835,650 $ 220,784,820

1. These numbers are on a managed basis. Managed basis assumes that loans that have been securitized were not sold and presents financial information regarding these loans in a manner similar to the presentation of financial information regarding loans that have not been sold. See Reconciliation of GAAP to Managed Data Schedule.

2. The quarters ended November 30, 2008, August 31, 2009 and November 30, 2009 include $864 million pre-tax (estimated $535 million after-tax), $472 million pre-tax

(estimated $287 million after-tax), and $472 million pre-tax (estimated $285 million after-tax) respectively, and the years ended November 30, 2008 and November 30, 2009 include $864 million pre-tax (estimated $535 million after-tax) and $1.9 billion (estimated $1.2 billion after-tax) respectively related to the Visa/Mastercard antitrust litigation settlement.

3. The year ended November 30, 2008 includes a loss from discontinued operations, net of tax, of $135 million consisting of a $166 million loss related to the sale of the Goldfish

business partially offset by $31 million of income related to the Goldfish business operations. 4. Earnings per share is based on net income available to common stockholders. Net income available to common stockholders equals net income less dividends and accretion of

discount on shares of preferred stock. 5. Based on continuing operations except for equity. Equity includes $1.2 billion of preferred stock and $7.3 billion of common equity as of November 30, 2009. 6. Reserve Rate (excluding guaranteed student loans), a non-GAAP measure, represents the allowance for loan losses as a percentage of total loans excluding guaranteed student

loans. The Company believes that a reserve rate excluding the government guaranteed portion of student loans is a more meaningful valuation to investors of the portion of the portfolio that has a risk of loss. For a corresponding reconciliation of loans excluding the guaranteed portion of student loans to a GAAP financial measure, see Reconciliation of GAAP to Managed Data schedule.

7. 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.

8. Gross proprietary sales volume on the Discover Network.

DISCOVER FINANCIAL SERVICES

RECONCILIATION OF GAAP TO MANAGED DATA The following presents a reconciliation for certain information disclosed above. The data below is presented on both a "managed" loan basis and as reported under generally accepted accounting principles ("owned" loan basis). Managed loan data assumes that the company's securitized loan receivables have not been sold and presents the results of securitized loan receivables in the same manner as the company's owned loans. The company operates its business and analyzes its financial performance on a managed basis. Accordingly, underwriting and servicing standards are comparable for both owned and securitized loans. The company believes that managed loan information is useful to investors because it provides information regarding the quality of loan origination and credit performance of the entire managed portfolio and allows investors to understand the related credit risks inherent in owned loans and retained interests in securitizations. Managed loan data is also relevant because the company services the securitized and owned loans, and the related accounts, in the same manner without regard to ownership of the loans. In addition, investors often request information on a managed basis which provides a more meaningful comparison to industry competitors. Reserve rate (excluding guaranteed student loans), a non-GAAP financial measure, represents the allowance for loan losses as a percentage of total loans excluding guaranteed student loans. A reconciliation of total loans, a GAAP financial measure, to loans excluding the guaranteed portion of student loans is shown below. A portion of the Company's student loans are 97% guaranteed by the federal government under the Federal Family Education Loan Program. These guaranteed student loans carry little default risk and therefore, are reserved at a significantly lower rate than the remaining portfolio. Management believes that a reserve rate excluding the government guaranteed portion of student loans is a more meaningful valuation to investors of the portion of the portfolio that has a risk of loss.

Discover Financial Services Reconciliation of GAAP to Managed Data (unaudited, dollars in thousands) Quarter Ended Year Ended Nov 30, 2009 Aug 31, 2009 Nov 30, 2008 Nov 30, 2009 Nov 30, 2008 Interest Income GAAP Basis $ 638,086 $ 833,217 $ 736,006 $ 3,145,080 $ 2,692,563 Securitization Adjustments 947,604 830,864 946,261 3,315,992 3,853,266 Managed Basis $ 1,585,690 $ 1,664,081 $ 1,682,267 $ 6,461,072 $ 6,545,829

Interest Expense GAAP Basis $ 314,158 $ 304,401 $ 329,672 $ 1,251,284 $ 1,288,004 Securitization Adjustments 89,140 88,241 272,778 397,136 1,068,915 Managed Basis $ 403,298 $ 392,642 $ 602,450 $ 1,648,420 $ 2,356,919

Net Interest Income GAAP Basis $ 323,928 $ 528,816 $ 406,334 $ 1,893,796 $ 1,404,559 Securitization Adjustments 858,464 742,623 673,483 2,918,856 2,784,351 Managed Basis $ 1,182,392 $ 1,271,439 $ 1,079,817 $ 4,812,652 $ 4,188,910

Other Income GAAP Basis $ 1,253,559 $ 1,315,960 $ 1,568,901 $ 4,840,595 $ 4,264,458 Securitization Adjustments (269,187 ) (199,195 ) (281,688 ) (922,920 ) (1,311,362 ) Managed Basis $ 984,372 $ 1,116,765 $ 1,287,213 $ 3,917,675 $ 2,953,096

Revenue Net of Interest Expense GAAP Basis $ 1,577,487 $ 1,844,776 $ 1,975,235 $ 6,734,391 $ 5,669,017 Securitization Adjustments 589,277 543,428 391,795 1,995,936 1,472,989 Managed Basis $ 2,166,764 $ 2,388,204 $ 2,367,030 $ 8,730,327 $ 7,142,006

Provision for Loan Losses GAAP Basis $ 399,732 $ 380,999 $ 714,176 $ 2,362,405 $ 1,595,615 Securitization Adjustments 589,277 543,428 391,795 1,995,936 1,472,989 Managed Basis $ 989,009 $ 924,427 $ 1,105,971 $ 4,358,341 $ 3,068,604

Total Assets GAAP Basis $ 46,010,146 $ 42,698,290 $ 39,892,382 $ 46,010,146 $ 39,892,382 Securitization Adjustments 26,968,289 25,096,019 25,728,094 26,968,289 25,728,094 Managed Basis $ 72,978,435 $ 67,794,309 $ 65,620,476 $ 72,978,435 $ 65,620,476

Total Loans GAAP Basis $ 23,625,084 $ 25,489,809 $ 25,216,611 $ 23,625,084 $ 25,216,611 Securitization Adjustments 27,235,288 25,414,036 25,878,667 27,235,288 25,878,667 Managed Basis $ 50,860,372 $ 50,903,845 $ 51,095,278 $ 50,860,372 $ 51,095,278

Total Loans - GAAP Basis $ 23,625,084 $ 25,489,809 $ 25,216,611 $ 23,625,084 $ 25,216,611

Less: Guaranteed portion of student loans 1,274,453 889,963 152,135 1,274,453 152,135 Total Loans excluding guaranteed portion of student loans $ 22,350,631 $ 24,599,846 $ 25,064,476 $ 22,350,631 $ 25,064,476

Average Total Loans GAAP Basis $ 23,835,598 $ 26,380,203 $ 22,945,494 $ 26,552,574 $ 21,348,493 Securitization Adjustments 26,755,248 24,590,853 27,761,596 24,588,040 27,662,655 Managed Basis $ 50,590,846 $ 50,971,056 $ 50,707,090 $ 51,140,614 $ 49,011,148

Return on Loan Receivables GAAP Basis 6.24 % 8.68 % 7.78 % 4.87 % 4.98 %

Securitization Adjustments 5.56 % 9.32 % 6.43 % 5.26 % 3.84 % Managed Basis 2.94 % 4.49 % 3.52 % 2.53 % 2.17 % Interest Yield GAAP Basis 10.25 % 12.10 % 11.36 % 11.31 % 10.89 % Securitization Adjustments 14.21 % 13.40 % 13.71 % 13.49 % 13.93 % Managed Basis 12.34 % 12.73 % 12.65 % 12.36 % 12.61 % Net Yield on Loan Receivables GAAP Basis 5.45 % 7.95 % 7.12 % 7.13 % 6.58 % Securitization Adjustments 12.87 % 11.98 % 9.76 % 11.87 % 10.07 % Managed Basis 9.37 % 9.90 % 8.56 % 9.41 % 8.55 % Net Principal Charge-off Rate GAAP Basis 7.98 % 8.05 % 5.25 % 7.45 % 4.59 % Securitization Adjustments 8.83 % 8.77 % 5.68 % 8.12 % 5.32 % Managed Basis 8.43 % 8.39 % 5.48 % 7.77 % 5.01 % Delinquency Rate (over 30 days) GAAP Basis 4.92 % 4.86 % 4.35 % 4.92 % 4.35 % Securitization Adjustments 5.65 % 5.35 % 4.77 % 5.65 % 4.77 % Managed Basis 5.31 % 5.10 % 4.56 % 5.31 % 4.56 % Delinquency Rate (over 90 days) GAAP Basis 2.58 % 2.46 % 2.06 % 2.58 % 2.06 % Securitization Adjustments 2.95 % 2.74 % 2.27 % 2.95 % 2.27 % Managed Basis 2.78 % 2.60 % 2.17 % 2.78 % 2.17 %

Exhibit 99.2 Discover Financial Services GAAP Basis (unaudited, dollars in thousands, except per share statistics) Quarter Ended Year Ended

Nov 30,

2009 Aug 31,

2009 May 31,

2009 Feb 28,

2009 Nov 30,

2008 Nov 30, 2009

vs Nov 30, 2008 Nov 30,

2009 Nov 30,

2008 2009 vs 2008 Earnings Summary

Interest Income $ 638,086 $ 833,217 $ 857,984 $ 815,793 $ 736,006 $ (97,920 ) (13 %) $ 3,145,080 $ 2,692,563 $ 452,517 17 % Interest Expense 314,158 304,401 320,005 312,720 329,672 (15,514 ) (5 %) 1,251,284 1,288,004 (36,720 ) (3 %)

Net Interest Income 323,928 528,816 537,979 503,073 406,334 (82,406 ) (20 %) 1,893,796 1,404,559 489,237 35 % Other Income 1 1,253,559 1,315,960 1,081,120 1,189,956 1,568,901 (315,342 ) (20 %) 4,840,595 4,264,458 576,137 14 % Revenue Net of Interest Expense 1,577,487 1,844,776 1,619,099 1,693,029 1,975,235 (397,748 ) (20 %) 6,734,391 5,669,017 1,065,374 19 % Provision for Loan Losses 399,732 380,999 643,861 937,813 714,176 (314,444 ) (44 %) 2,362,405 1,595,615 766,790 48 %

Employee Compensation and Benefits 191,516 208,528 208,151 219,488 187,306 4,210 2 % 827,683 845,392 (17,709 ) (2 %) Marketing and Business Development 113,851 77,814 102,922 111,433 119,382 (5,531 ) (5 %) 406,020 530,901 (124,881 ) (24 %) Information Processing & Communications 72,192 67,679 74,441 74,897 81,543 (9,351 ) (11 %) 289,209 315,943 (26,734 ) (8 %) Professional Fees 92,910 83,746 74,550 70,123 111,645 (18,735 ) (17 %) 321,329 349,484 (28,155 ) (8 %) Premises and Equipment 18,282 18,437 18,223 18,072 20,676 (2,394 ) (12 %) 73,014 80,394 (7,380 ) (9 %) Other Expense 89,756 67,634 82,341 65,110 73,530 16,226 22 % 304,841 293,683 11,158 4 %

Total Other Expense 578,507 523,838 560,628 559,123 594,082 (15,575 ) (3 %) 2,222,096 2,415,797 (193,701 ) (8 %) Income Before Income Taxes 1 599,248 939,939 414,610 196,093 666,977 (67,729 ) (10 %) 2,149,890 1,657,605 492,285 30 % Tax Expense 228,560 362,485 188,810 75,699 223,336 5,224 2 % 855,554 594,692 260,862 44 % Income From Continuing Operations 1 370,688 577,454 225,800 120,394 443,641 (72,953 ) (16 %) 1,294,336 1,062,913 231,423 22 % Discontinued Operations, Net of Tax 2 - - - - (11,306 ) 11,306 100 % - (135,163 ) 135,163 100 % Net Income 1, 2 $ 370,688 $ 577,454 $ 225,800 $ 120,394 $ 432,335 $ (61,647 ) (14 %) $ 1,294,336 $ 927,750 $ 366,586 40 %

Net Income Available to Common Stockholders 1, 2 ,

3 $ 352,054 $ 559,387 $ 209,246 $ 120,394 $ 432,335 $ (80,281 ) (19 %) $ 1,241,081 $ 927,750 $ 313,331 34 %

Effective Tax Rate From Continuing Operations 38.1 % 38.6 % 45.5 % 38.6 % 33.5 % 39.8 % 35.9 % Balance Sheet Statistics 4 Total Assets $ 46,010,146 $ 42,698,290 $ 41,518,288 $ 40,606,518 $ 39,892,382 $ 6,117,764 15 % $ 46,010,146 $ 39,892,382 $ 6,117,764 15 % Tangible Assets $ 45,559,089 $ 42,245,313 $ 41,063,390 $ 40,149,699 $ 39,433,642 $ 6,125,447 16 % $ 45,559,089 $ 39,433,642 $ 6,125,447 16 % Total Equity $ 8,466,755 $ 8,386,202 $ 7,415,640 $ 5,999,351 $ 5,915,823 $ 2,550,932 43 % $ 8,466,755 $ 5,915,823 $ 2,550,932 43 % Total Common Equity $ 7,308,689 $ 7,231,463 $ 6,263,661 $ 5,999,351 $ 5,915,823 $ 1,392,866 24 % $ 7,308,689 $ 5,915,823 $ 1,392,866 24 % Total Common Equity/Total Assets 15.9 % 16.9 % 15.1 % 14.8 % 14.8 % 15.9 % 14.8 % Total Common Equity/Net Loans - Owned 33.4 % 30.6 % 24.6 % 22.9 % 24.8 % 33.4 % 24.8 % ROE 1, 2 17 % 28 % 12 % 8 % 29 % 17 % 16 % ROE from Continuing Operations 1 17 % 28 % 12 % 8 % 30 % 17 % 18 % Allowance for Loan Loss (period end) $ 1,757,899 $ 1,832,360 $ 1,986,473 $ 1,878,942 $ 1,374,585 $ 383,314 28 % $ 1,757,899 $ 1,374,585 $ 383,314 28 % Change in Loan Loss Reserves $ (74,461 ) $ (154,113 ) $ 107,531 $ 504,357 $ 414,816 $ (489,277 ) (118 %) $ 383,314 $ 614,660 $ (231,346 ) (38 %) Reserve Rate 7.44 % 7.19 % 7.24 % 6.70 % 5.45 % 199 bps 7.44 % 5.45 % 199 bps Interest-only Strip Receivable (period end) $ 117,579 $ 162,252 $ 94,670 $ 198,536 $ 300,120 $ (182,541 ) (61 %) $ 117,579 $ 300,120 $ (182,541 ) (61 %) Net Revaluation of Retained Interests $ (37,771 ) $ 68,880 $ (92,954 ) $ (98,242 ) $ (116,335 ) $ 78,564 68 % $ (160,087 ) $ (119,324 ) $ (40,763 ) (34 %) Per Share Statistics Basic EPS 1, 2, 5 $ 0.65 $ 1.09 $ 0.43 $ 0.25 $ 0.90 $ (0.25 ) (28 %) $ 2.46 $ 1.94 $ 0.52 27 % Basic EPS from Continuing Operations 1, 5 $ 0.65 $ 1.09 $ 0.43 $ 0.25 $ 0.92 $ (0.27 ) (29 %) $ 2.46 $ 2.22 $ 0.24 11 % Diluted EPS 1, 2, 5 $ 0.63 $ 1.07 $ 0.43 $ 0.25 $ 0.89 $ (0.26 ) (29 %) $ 2.42 $ 1.92 $ 0.50 26 % Diluted EPS from Continuing Operations 1, 5 $ 0.63 $ 1.07 $ 0.43 $ 0.25 $ 0.92 $ (0.29 ) (32 %) $ 2.42 $ 2.20 $ 0.22 10 % Common Stock Price (period end) $ 15.46 $ 13.75 $ 9.56 $ 5.73 $ 10.23 $ 5.23 51 % $ 15.46 $ 10.23 $ 5.23 51 % Book Value $ 15.59 $ 15.45 $ 15.40 $ 12.46 $ 12.32 $ 3.27 27 % $ 15.59 $ 12.32 $ 3.27 27 % Ending Common Shares Outstanding (000's) 542,922 542,749 481,676 481,459 479,987 62,935 13 % 542,922 479,987 62,935 13 % Weighted Average Common Shares Outstanding (000's) 542,826 513,098 481,636 480,497 479,931 62,895 13 % 504,550 479,335 25,215 5 % Weighted Average Common Shares

Outstanding (fully diluted) (000's) 555,066 520,579 484,965 485,043 484,558 70,508 15 % 511,803 483,470 28,333 6 % Loan Receivables 4 Total Loans - Owned $ 23,625,084 $ 25,489,809 $ 27,441,514 $ 28,034,208 $ 25,216,611 $ (1,591,527 ) (6 %) $ 23,625,084 $ 25,216,611 $ (1,591,527 ) (6 %)

Less: Allowance for Loan Loss (period end) 1,757,899 1,832,360 1,986,473 1,878,942 1,374,585 383,314 28 % 1,757,899 1,374,585 383,314 28 % Net Loans - Owned $ 21,867,185 $ 23,657,449 $ 25,455,041 $ 26,155,266 $ 23,842,026 $ (1,974,841 ) (8 %) $ 21,867,185 $ 23,842,026 $ (1,974,841 ) (8 %)

Average Total Loans - Owned $ 23,835,598 $ 26,380,203 $ 28,257,484 $ 27,733,143 $ 22,945,494 $ 890,104 4 % $ 26,552,574 $ 21,348,493 $ 5,204,081 24 % Interest Yield 10.25 % 12.10 % 11.54 % 11.24 % 11.36 % (111 ) bps 11.31 % 10.89 % 42 bps Net Principal Charge-off Rate 7.98 % 8.05 % 7.53 % 6.34 % 5.25 % 273 bps 7.45 % 4.59 % 286 bps Delinquency Rate (over 30 days) 4.92 % 4.86 % 4.87 % 5.04 % 4.35 % 57 bps 4.92 % 4.35 % 57 bps Delinquency Rate (over 90 days) 2.58 % 2.46 % 2.60 % 2.57 % 2.06 % 52 bps 2.58 % 2.06 % 52 bps Transactions Processed on Networks (000's) Discover Network 387,350 390,643 366,315 369,647 377,356 9,994 3 % 1,513,955 1,515,368 (1,413 ) (0 %) PULSE Network 676,817 753,201 762,175 686,527 644,045 32,772 5 % 2,878,720 2,682,312 196,408 7 % Total 1,064,167 1,143,844 1,128,490 1,056,174 1,021,401 42,766 4 % 4,392,675 4,197,680 194,995 5 %

Volume PULSE Network $ 24,667,926 $ 28,051,978 $ 29,128,044 $ 27,454,173 $ 25,033,235 $ (365,309 ) (1 %) $ 109,302,121 $ 106,012,108 $ 3,290,013 3 % Third-Party Issuers 1,522,269 1,446,308 1,340,532 1,362,446 1,538,013 (15,744 ) (1 %) 5,671,555 6,398,579 (727,024 ) (11 %) Diners Club International 6 7,172,809 6,465,990 6,240,604 6,293,574 7,457,893 (285,566 ) (4 %) 26,172,977 12,685,690 13,486,805 106 %

Total Third-Party Payments 33,363,004 35,964,276 36,709,180 35,110,193 34,029,141 (666,619 ) (2 %) 141,146,653 125,096,377 16,049,794 13 %

Discover Network - Proprietary 7 22,712,600 23,579,434 21,972,596 22,424,367 22,875,272 (162,672 ) (1 %) 90,688,997 95,688,443 (4,999,446 ) (5 %) Total $ 56,075,604 $ 59,543,710 $ 58,681,776 $ 57,534,560 $ 56,904,413 $ (829,291 ) (1 %) $ 231,835,650 $ 220,784,820 $ 11,050,348 5 %

Discover Financial Services Managed Basis 8 (unaudited, dollars in thousands) Quarter Ended Year Ended

Nov 30,

2009 Aug 31,

2009 May 31,

2009 Feb 28,

2009 Nov 30,

2008 Nov 30, 2009

vs Nov 30, 2008 Nov 30,

2009 Nov 30,

2008 2009 vs 2008 Earnings Summary

Interest Income $ 1,585,690 $ 1,664,081 $ 1,607,452 $ 1,603,849 $ 1,682,267 $ (96,577 ) (6 %) $ 6,461,072 $ 6,545,829 $ (84,757 ) (1 %) Interest Expense 403,298 392,642 414,063 438,417 602,450 (199,152 ) (33 %) 1,648,420 2,356,919 (708,499 ) (30 %)

Net Interest Income 1,182,392 1,271,439 1,193,389 1,165,432 1,079,817 102,575 9 % 4,812,652 4,188,910 623,742 15 % Other Income 1 984,372 1,116,765 893,081 923,457 1,287,213 (302,841 ) (24 %) 3,917,675 2,953,096 964,579 33 % Revenue Net of Interest Expense 2,166,764 2,388,204 2,086,470 2,088,889 2,367,030 (200,266 ) (8 %) 8,730,327 7,142,006 1,588,321 22 % Provision for Loan Losses 989,009 924,427 1,111,232 1,333,673 1,105,971 (116,962 ) (11 %) 4,358,341 3,068,604 1,289,737 42 %

Employee Compensation and Benefits 191,516 208,528 208,151 219,488 187,306 4,210 2 % 827,683 845,392 (17,709 ) (2 %) Marketing and Business Development 113,851 77,814 102,922 111,433 119,382 (5,531 ) (5 %) 406,020 530,901 (124,881 ) (24 %) Information Processing & Communications 72,192 67,679 74,441 74,897 81,543 (9,351 ) (11 %) 289,209 315,943 (26,734 ) (8 %) Professional Fees 92,910 83,746 74,550 70,123 111,645 (18,735 ) (17 %) 321,329 349,484 (28,155 ) (8 %) Premises and Equipment 18,282 18,437 18,223 18,072 20,676 (2,394 ) (12 %) 73,014 80,394 (7,380 ) (9 %) Other Expense 89,756 67,634 82,341 65,110 73,530 16,226 22 % 304,841 293,683 11,158 4 %

Total Other Expense 578,507 523,838 560,628 559,123 594,082 (15,575 ) (3 %) 2,222,096 2,415,797 (193,701 ) (8 %) Income Before Income Taxes 1 599,248 939,939 414,610 196,093 666,977 (67,729 ) (10 %) 2,149,890 1,657,605 492,285 30 % Tax Expense 228,560 362,485 188,810 75,699 223,336 5,224 2 % 855,554 594,692 260,862 44 % Income From Continuing Operations 1 370,688 577,454 225,800 120,394 443,641 (72,953 ) (16 %) 1,294,336 1,062,913 231,423 22 % Discontinued Operations, Net of Tax 2 - - - - (11,306 ) 11,306 100 % - (135,163 ) 135,163 100 % Net Income 1, 2 $ 370,688 $ 577,454 $ 225,800 $ 120,394 $ 432,335 $ (61,647 ) (14 %) $ 1,294,336 $ 927,750 $ 366,586 40 %

Balance Sheet Statistics 4 Total Assets $ 72,978,435 $ 67,794,309 $ 64,846,824 $ 63,231,657 $ 65,620,476 $ 7,357,959 11 % $ 72,978,435 $ 65,620,476 $ 7,357,959 11 % Tangible Managed Assets $ 72,527,378 $ 67,341,332 $ 64,391,926 $ 62,774,838 $ 65,161,736 $ 7,365,642 11 % $ 72,527,378 $ 65,161,736 $ 7,365,642 11 % Total Equity 9 $ 8,466,755 $ 8,386,202 $ 7,415,640 $ 5,999,351 $ 5,915,823 $ 2,550,932 43 % $ 8,466,755 $ 5,915,823 $ 2,550,932 43 % Total Common Equity 9 $ 7,308,689 $ 7,231,463 $ 6,263,661 $ 5,999,351 $ 5,915,823 $ 1,392,866 24 % $ 7,308,689 $ 5,915,823 $ 1,392,866 24 % Tangible Common Equity 10 $ 6,857,632 $ 6,778,486 $ 5,808,763 $ 5,542,532 $ 5,457,083 $ 1,400,549 26 % $ 6,857,632 $ 5,457,083 $ 1,400,549 26 % Total Common Equity/Tangible Managed Assets 11 10.1 % 10.7 % 9.7 % 9.6 % 9.1 % 10.1 % 9.1 % Tangible Common Equity/Tangible Managed Assets 10, 12 9.5 % 10.1 % 9.0 % 8.8 % 8.4 % 9.5 % 8.4 % Tangible Common Equity/Net Loans - Managed 10 14.0 % 13.8 % 11.8 % 11.3 % 11.0 % 14.0 % 11.0 % Tangible Common Equity per share 10 $ 12.63 $ 12.49 $ 12.06 $ 11.51 $ 11.37 $ 1.26 11 % $ 12.63 $ 11.37 $ 1.26 11 % Net Yield on Managed Loan Receivables 9.37 % 9.90 % 9.26 % 9.11 % 8.56 % 81 bps 9.41 % 8.55 % 86 bps Return on Managed Loan Receivables 1 2.94 % 4.49 % 1.75 % 0.94 % 3.52 % (58 ) bps 2.53 % 2.17 % 36 bps Reserve Rate (excluding guaranteed student loans) 13 7.87 % 7.45 % 7.36 % 6.78 % 5.48 % 238 bps 7.87 % 5.48 % 238 bps Loan Receivables 4 Total Loans - Managed $ 50,860,372 $ 50,903,845 $ 51,032,382 $ 50,888,704 $ 51,095,278 $ (234,906 ) (0 %) $ 50,860,372 $ 51,095,278 $ (234,906 ) (0 %)

Less: Allowance for Loan Loss (period end) 1,757,899 1,832,360 1,986,473 1,878,942 1,374,585 383,314 28 % 1,757,899 1,374,585 383,314 28 % Net Loans - Managed $ 49,102,473 $ 49,071,485 $ 49,045,909 $ 49,009,762 $ 49,720,693 $ (618,220 ) (1 %) $ 49,102,473 $ 49,720,693 $ (618,220 ) (1 %)

Average Total Loans - Managed $ 50,590,846 $ 50,971,056 $ 51,132,761 $ 51,877,845 $ 50,707,090 $ (116,244 ) (0 %) $ 51,140,614 $ 49,011,148 $ 2,129,466 4 % Managed Interest Yield 12.34 % 12.73 % 12.19 % 12.17 % 12.65 % (31 ) bps 12.36 % 12.61 % (25 ) bps Managed Net Principal Charge-off Rate 8.43 % 8.39 % 7.79 % 6.48 % 5.48 % 295 bps 7.77 % 5.01 % 276 bps Managed Delinquency Rate (over 30 days) 5.31 % 5.10 % 5.08 % 5.25 % 4.56 % 75 bps 5.31 % 4.56 % 75 bps Managed Delinquency Rate (over 90 days) 2.78 % 2.60 % 2.73 % 2.69 % 2.17 % 61 bps 2.78 % 2.17 % 61 bps Total Discover Card Volume $ 23,335,440 $ 23,955,402 $ 24,336,751 $ 23,964,577 $ 25,318,553 $ (1,983,113 ) (8 %) $ 95,592,170 $ 105,734,055 $ (10,141,885 ) (10 %) Discover Card Sales Volume $ 21,903,694 $ 22,768,927 $ 21,494,174 $ 21,293,757 $ 22,025,264 $ (121,570 ) (1 %) $ 87,460,552 $ 92,239,779 $ (4,779,227 ) (5 %) Segment - Income Before Income Taxes

U.S. Card 1 $ 575,477 $ 912,800 $ 387,902 $ 167,167 $ 646,427 $ (70,950 ) (11 %) $ 2,043,346 $ 1,576,194 $ 467,152 30 % Third-Party Payments 23,771 27,139 26,708 28,926 20,550 3,221 16 % 106,544 81,411 25,133 31 % Total 1 $ 599,248 $ 939,939 $ 414,610 $ 196,093 $ 666,977 $ (67,729 ) (10 %) $ 2,149,890 $ 1,657,605 $ 492,285 30 %

Discover Financial Services U.S. Card Segment Managed Basis 8 (unaudited, dollars in thousands) Quarter Ended Year Ended

Nov 30,

2009 Aug 31,

2009 May 31,

2009 Feb 28,

2009 Nov 30,

2008 Nov 30, 2009

vs Nov 30, 2008 Nov 30,

2009 Nov 30,

2008 2009 vs 2008 Earnings Summary Interest Income $ 1,585,612 $ 1,663,886 $ 1,607,114 $ 1,603,362 $ 1,680,925 $ (95,313 ) (6 %) $ 6,459,974 $ 6,542,664 $ (82,690 ) (1 %) Interest Expense 403,266 392,592 414,002 438,338 602,386 (199,120 ) (33 %) 1,648,198 2,356,836 (708,638 ) (30 %) Net Interest Income 1,182,346 1,271,294 1,193,112 1,165,024 1,078,539 103,807 10 % 4,811,776 4,185,828 625,948 15 % Other Income 1 924,499 1,055,529 834,630 863,223 1,234,100 (309,601 ) (25 %) 3,677,881 2,773,896 903,985 33 % Revenue Net of Interest Expense 2,106,845 2,326,823 2,027,742 2,028,247 2,312,639 (205,794 ) (9 %) 8,489,657 6,959,724 1,529,933 22 % Provision for Loan Losses 989,009 924,427 1,111,232 1,333,673 1,105,971 (116,962 ) (11 %) 4,358,341 3,068,604 1,289,737 42 % Total Other Expense 542,359 489,596 528,608 527,407 560,241 (17,882 ) (3 %) 2,087,970 2,314,926 (226,956 ) (10 %) Income Before Income Taxes 1 $ 575,477 $ 912,800 $ 387,902 $ 167,167 $ 646,427 $ (70,950 ) (11 %) $ 2,043,346 $ 1,576,194 $ 467,152 30 %

Net Yield on Managed Loan Receivables 9.37 % 9.90 % 9.26 % 9.11 % 8.55 % 82 bps 9.41 % 8.54 % 87 bps Pretax Return on Managed Loan Receivables 1 4.56 % 7.10 % 3.01 % 1.31 % 5.13 % (57 ) bps 4.00 % 3.22 % 78 bps Loan Receivables Total Loans - Managed $ 50,860,372 $ 50,903,845 $ 51,032,382 $ 50,888,704 $ 51,095,278 $ (234,906 ) (0 %) $ 50,860,372 $ 51,095,278 $ (234,906 ) (0 %) Average Total Loans - Managed $ 50,590,846 $ 50,971,056 $ 51,132,761 $ 51,877,845 $ 50,707,090 $ (116,244 ) (0 %) $ 51,140,614 $ 49,011,148 $ 2,129,466 4 % Managed Interest Yield 12.34 % 12.73 % 12.19 % 12.17 % 12.65 % (31 ) bps 12.36 % 12.61 % (25 ) bps Managed Net Principal Charge-off Rate 8.43 % 8.39 % 7.79 % 6.48 % 5.48 % 295 bps 7.77 % 5.01 % 276 bps Managed Delinquency Rate (over 30 days) 5.31 % 5.10 % 5.08 % 5.25 % 4.56 % 75 bps 5.31 % 4.56 % 75 bps Managed Delinquency Rate (over 90 days) 2.78 % 2.60 % 2.73 % 2.69 % 2.17 % 61 bps 2.78 % 2.17 % 61 bps Credit Card Loans Credit Card Loans - Managed $ 47,465,590 $ 48,135,639 $ 48,903,632 $ 49,011,177 $ 49,692,974 $ (2,227,384 ) (4 %) $ 47,465,590 $ 49,692,974 $ (2,227,384 ) (4 %) Average Credit Card Loans - Managed $ 47,429,775 $ 48,641,890 $ 49,108,321 $ 50,254,235 $ 49,420,412 $ (1,990,637 ) (4 %) $ 48,854,822 $ 48,229,519 $ 625,303 1 % Managed Interest Yield 12.75 % 12.99 % 12.37 % 12.28 % 12.72 % 3 bps 12.59 % 12.65 % (6 ) bps Managed Net Principal Charge-off Rate 8.81 % 8.63 % 7.99 % 6.61 % 5.59 % 322 bps 8.00 % 5.07 % 293 bps Managed Delinquency Rate (over 30 days) 5.60 % 5.31 % 5.23 % 5.41 % 4.66 % 94 bps 5.60 % 4.66 % 94 bps Managed Delinquency Rate (over 90 days) 2.94 % 2.72 % 2.82 % 2.78 % 2.22% 72 bps 2.94 % 2.22 % 72 bps Total Discover Card Volume $ 23,335,440 $ 23,955,402 $ 24,336,751 $ 23,964,577 $ 25,318,553 $ (1,983,113 ) (8 %) $ 95,592,170 $ 105,734,055 $ (10,141,885 ) (10 %) Discover Card Sales Volume $ 21,903,694 $ 22,768,927 $ 21,494,174 $ 21,293,757 $ 22,025,264 $ (121,570 ) (1 %) $ 87,460,552 $ 92,239,779 $ (4,779,227 ) (5 %)

Discover Financial Services Third-Party Payments Segment (unaudited, dollars in thousands) Quarter Ended Year Ended

Nov 30,

2009 Aug 31,

2009 May 31,

2009 Feb 28,

2009 Nov 30,

2008

Nov 30, 2009 vs Nov 30,

2008 Nov 30,

2009 Nov 30,

2008 2009 vs 2008 Earnings Summary Interest Income $ 78 $ 195 $ 338 $ 487 $ 1,342 $ (1,264 ) (94 %) $ 1,098 $ 3,165 $ (2,067 ) (65 %) Interest Expense 32 50 61 79 64 (32 ) (50 %) 222 83 139 167 % Net Interest Income 46 145 277 408 1,278 (1,232 ) (96 %) 876 3,082 (2,206 ) (72 %) Other Income 59,873 61,236 58,451 60,234 53,113 6,760 13 % 239,794 179,200 60,594 34 % Revenue Net of Interest Expense 59,919 61,381 58,728 60,642 54,391 5,528 10 % 240,670 182,282 58,388 32 % Provision for Loan Losses - - - - - - NM - - - NM Total Other Expense 36,148 34,242 32,020 31,716 33,841 2,307 7 % 134,126 100,871 33,255 33 % Income Before Income Taxes $ 23,771 $ 27,139 $ 26,708 $ 28,926 $ 20,550 $ 3,221 16 % $ 106,544 $ 81,411 $ 25,133 31 %

Volume PULSE Network $ 24,667,926 $ 28,051,978 $ 29,128,044 $ 27,454,173 $ 25,033,235 $ (365,309 ) (1 %) $ 109,302,121 $ 106,012,108 $ 3,290,013 3 % Third-Party Issuers 1,522,269 1,446,308 1,340,532 1,362,446 1,538,013 (15,744 ) (1 %) 5,671,555 6,398,579 (727,024 ) (11 %) Diners Club International 6 7,172,809 6,465,990 6,240,604 6,293,574 7,457,893 (285,566 ) (4 %) 26,172,977 12,685,690 13,486,805 106 %

Total Third-Party Payments $ 33,363,004 $ 35,964,276 $ 36,709,180 $ 35,110,193 $ 34,029,141 $ (666,619 ) (2 %) $ 141,146,653 $ 125,096,377 $ 16,049,794 13 %

Transactions Processed on PULSE Network (000's) 676,817 753,201 762,175 686,527 644,045 32,772 5 % 2,878,720 2,682,312 196,408 7 %

1 The quarters ended November 30, 2008, February 28, 2009, May 31, 2009, August 31, 2009 and November 30, 2009 include $864 million pre-tax (estimated $535 million after-tax), $475 million pre-tax (estimated $297 million after-tax), $473 million pre-tax (estimated $295 million after-tax), $472 million pre-tax (estimated $287 million after-tax), and $472 million (estimated $285 million after-tax), respectively related to the Visa/Mastercard anti-trust litigation settlement.

2 The year ended November 30, 2008 includes a loss from discontinued operations, net of tax, of $135 million consisting of a $166 million loss related to the sale of the Goldfish

business partially offset by $31 million of income related to the Goldfish business operations. 3 Net income available to common stockholders equals net income less dividends and accretion of discount on shares of preferred stock. 4 Based on continuing operations except equity and ROE. Equity includes $1.2 billion of preferred stock and $7.3 billion of common equity as of November 30, 2009. 5 Earnings per share is based on net income available to common stockholders. 6 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. 7 Gross proprietary sales volume on the Discover Network. 8 Managed basis assumes that loans that have been securitized were not sold and presents financial information regarding these loans in a manner similar to the presentation of

financial information regarding loans that have not been sold. See Reconciliation of GAAP to Managed Data schedule. 9 Balance on a GAAP and Managed basis is the same. 10 Tangible common equity ("TCE"), a non-GAAP financial measure, represents common equity less goodwill and intangibles. The Company believes TCE is a more meaningful

valuation 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 Managed Data schedule.

11 Represents total common equity divided by total managed assets less goodwill and intangibles. 12 Represents total common equity less goodwill and intangibles divided by total managed assets less goodwill and intangibles. 13 Reserve Rate (excluding guaranteed student loans), a non-GAAP measure, represents the allowance for loan losses as a percentage of total loans excluding guaranteed student

loans. The Company believes that a reserve rate excluding the government guaranteed portion of student loans is a more meaningful valuation to investors of the portion of the portfolio that has a risk of loss. For a corresponding reconciliation of loans excluding the guaranteed portion of student loans to a GAAP financial measure, see Reconciliation of GAAP to Managed Data schedule.

14 Securitization Adjustments present the effect of loan securitization by recharacterizing as securitization income the portions of the following items that relate to the securitized

loans: interest income, interest expense, provision for loan losses, discount and interchange revenue and loan fee revenues. Securitization income is reported in other income.

DISCOVER FINANCIAL SERVICES

RECONCILIATION OF GAAP TO MANAGED DATA The following pages present a reconciliation for certain information disclosed in the financial data supplement. The data is presented on both a "managed" loan basis and as reported under generally accepted accounting principles ("owned" loan basis). Managed loan data assumes that the company's securitized loan receivables have not been sold and presents the results of securitized loan receivables in the same manner as the company's owned loans. The company operates its business and analyzes its financial performance on a managed basis. Accordingly, underwriting and servicing standards are comparable for both owned and securitized loans. The company believes that managed loan information is useful to investors because it provides information regarding the quality of loan origination and credit performance of the entire managed portfolio and allows investors to understand the related credit risks inherent in owned loans and retained interests in securitizations. Managed loan data is also relevant because the company services the securitized and owned loans, and the related accounts, in the same manner without regard to ownership of the loans. In addition, investors often request information on a managed basis which provides a more meaningful comparison to industry competitors. Tangible common equity ("TCE"), a non-GAAP financial measure, represents common equity less goodwill and intangibles. A reconcilation of TCE to common equity, a GAAP financial measure, is shown on the pages that follow. 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, TCE as a percentage of tangible managed assets, TCE as a percentage of net managed loans and TCE per share are included because management believes that common equity excluding goodwill and intangibles is a more meaningful valuation to investors of the true net asset value of the company. Reserve rate (excluding guaranteed student loans), a non-GAAP financial measure, represents the allowance for loan losses as a percentage of total loans excluding guaranteed student loans. A reconciliation of total loans, a GAAP financial measure, to loans excluding the guaranteed portion of student loans is shown on the pages that follow. A portion of the Company's student loans are 97% guaranteed by the federal government under the Federal Family Education Loan Program. These guaranteed student loans carry little default risk and therefore, are reserved at a significantly lower rate than the remaining portfolio. Management believes that a reserve rate excluding the government guaranteed portion of student loans is a more meaningful valuation to investors of the portion of the portfolio that has a risk of loss.

Discover Financial Services Reconciliation of GAAP to Managed Data 8 (unaudited, dollars in thousands) Quarter Ended Year Ended Nov 30, 2009 Aug 31, 2009 May 31, 2009 Feb 28, 2009 Nov 30, 2008 Nov 30, 2009 Nov 30, 2008 Interest Income GAAP Basis $ 638,086 $ 833,217 $ 857,984 $ 815,793 $ 736,006 $ 3,145,080 $ 2,692,563 Securitization Adjustments 14 947,604 830,864 749,468 788,056 946,261 3,315,992 3,853,266 Managed Basis $ 1,585,690 $ 1,664,081 $ 1,607,452 $ 1,603,849 $ 1,682,267 $ 6,461,072 $ 6,545,829

Interest Expense GAAP Basis $ 314,158 $ 304,401 $ 320,005 $ 312,720 $ 329,672 $ 1,251,284 $ 1,288,004 Securitization Adjustments 89,140 88,241 94,058 125,697 272,778 397,136 1,068,915 Managed Basis $ 403,298 $ 392,642 $ 414,063 $ 438,417 $ 602,450 $ 1,648,420 $ 2,356,919

Net Interest Income GAAP Basis $ 323,928 $ 528,816 $ 537,979 $ 503,073 $ 406,334 $ 1,893,796 $ 1,404,559 Securitization Adjustments 858,464 742,623 655,410 662,359 673,483 2,918,856 2,784,351 Managed Basis $ 1,182,392 $ 1,271,439 $ 1,193,389 $ 1,165,432 $ 1,079,817 $ 4,812,652 $ 4,188,910

Other Income GAAP Basis $ 1,253,559 $ 1,315,960 $ 1,081,120 $ 1,189,956 $ 1,568,901 $ 4,840,595 $ 4,264,458 Securitization Adjustments (269,187 ) (199,195 ) (188,039 ) (266,499 ) (281,688 ) (922,920 ) (1,311,362 ) Managed Basis $ 984,372 $ 1,116,765 $ 893,081 $ 923,457 $ 1,287,213 $ 3,917,675 $ 2,953,096

Revenue Net of Interest Expense GAAP Basis $ 1,577,487 $ 1,844,776 $ 1,619,099 $ 1,693,029 $ 1,975,235 $ 6,734,391 $ 5,669,017 Securitization Adjustments 589,277 543,428 467,371 395,860 391,795 1,995,936 1,472,989 Managed Basis $ 2,166,764 $ 2,388,204 $ 2,086,470 $ 2,088,889 $ 2,367,030 $ 8,730,327 $ 7,142,006

Provision for Loan Losses GAAP Basis $ 399,732 $ 380,999 $ 643,861 $ 937,813 $ 714,176 $ 2,362,405 $ 1,595,615 Securitization Adjustments 589,277 543,428 467,371 395,860 391,795 1,995,936 1,472,989 Managed Basis $ 989,009 $ 924,427 $ 1,111,232 $ 1,333,673 $ 1,105,971 $ 4,358,341 $ 3,068,604

Total Assets GAAP Basis $ 46,010,146 $ 42,698,290 $ 41,518,288 $ 40,606,518 $ 39,892,382 $ 46,010,146 $ 39,892,382 Securitization Adjustments 26,968,289 25,096,019 23,328,536 22,625,139 25,728,094 26,968,289 25,728,094 Managed Basis $ 72,978,435 $ 67,794,309 $ 64,846,824 $ 63,231,657 $ 65,620,476 $ 72,978,435 $ 65,620,476

Tangible Assets GAAP Basis $ 45,559,089 $ 42,245,313 $ 41,063,390 $ 40,149,699 $ 39,433,642 $ 45,559,089 $ 39,433,642 Securitization Adjustments 26,968,289 25,096,019 23,328,536 22,625,139 25,728,094 26,968,289 25,728,094 Managed Basis $ 72,527,378 $ 67,341,332 $ 64,391,926 $ 62,774,838 $ 65,161,736 $ 72,527,378 $ 65,161,736

Total Common Equity $ 7,308,689 $ 7,231,463 $ 6,263,661 $ 5,999,351 $ 5,915,823 $ 7,308,689 $ 5,915,823 Less: Goodwill 255,421 255,421 255,421 255,421 255,421 255,421 255,421 Less: Intangibles 195,636 197,556 199,477 201,398 203,319 195,636 203,319 Tangible Common Equity $ 6,857,632 $ 6,778,486 $ 5,808,763 $ 5,542,532 $ 5,457,083 $ 6,857,632 $ 5,457,083

Total Common Equity/Tangible Assets GAAP Basis 16.0 % 17.1 % 15.3 % 14.9 % 15.0 % 16.0 % 15.0 % Securitization Adjustments 27.1 % 28.8 % 26.8 % 26.5 % 23.0 % 27.1 % 23.0 % Managed Basis 10.1 % 10.7 % 9.7 % 9.6 % 9.1 % 10.1 % 9.1 % Tangible Common Equity/Tangible Assets GAAP Basis 15.1 % 16.0 % 14.1 % 13.8 % 13.8 % 15.1 % 13.8 % Securitization Adjustments 25.4 % 27.0 % 24.9 % 24.5 % 21.2 % 25.4 % 21.2 % Managed Basis 9.5 % 10.1 % 9.0 % 8.8 % 8.4 % 9.5 % 8.4 % Total Common Equity/Net Loans GAAP Basis 33.4 % 30.6 % 24.6 % 22.9 % 24.8 % 33.4 % 24.8 % Securitization Adjustments 26.8 % 28.5 % 26.6 % 26.3 % 22.9 % 26.8 % 22.9 % Managed Basis 14.9 % 14.7 % 12.8 % 12.2 % 11.9 % 14.9 % 11.9 %

Discover Financial Services Reconciliation of GAAP to Managed Data 8 (unaudited, dollars in thousands) Quarter Ended Year Ended Nov 30, 2009 Aug 31, 2009 May 31, 2009 Feb 28, 2009 Nov 30, 2008 Nov 30, 2009 Nov 30, 2008 Tangible Common Equity/Net Loans GAAP Basis 31.4 % 28.7 % 22.8 % 21.2 % 22.9 % 31.4 % 22.9 % Securitization Adjustments 25.2 % 26.7 % 24.6 % 24.3 % 21.1 % 25.2 % 21.1 % Managed Basis 14.0 % 13.8 % 11.8 % 11.3 % 11.0 % 14.0 % 11.0 % Book Value $ 15.59 $ 15.45 $ 15.40 $ 12.46 $ 12.32 $ 15.59 $ 12.32 Less: Goodwill (0.47 ) (0.47 ) (0.53 ) (0.53 ) (0.53 ) (0.47 ) (0.53 ) Less: Intangibles (0.36 ) (0.36 ) (0.41 ) (0.42 ) (0.42 ) (0.36 ) (0.42 ) Less: Preferred Stock (2.13 ) (2.13 ) (2.40 ) 0.00 0.00 (2.13 ) 0.00 Tangible Common Equity per share $ 12.63 $ 12.49 $ 12.06 $ 11.51 $ 11.37 $ 12.63 $ 11.37

Loan Receivables Total Loans GAAP Basis $ 23,625,084 $ 25,489,809 $ 27,441,514 $ 28,034,208 $ 25,216,611 $ 23,625,084 $ 25,216,611 Securitization Adjustments 27,235,288 25,414,036 23,590,868 22,854,496 25,878,667 27,235,288 25,878,667 Managed Basis $ 50,860,372 $ 50,903,845 $ 51,032,382 $ 50,888,704 $ 51,095,278 $ 50,860,372 $ 51,095,278

Total Loans - GAAP Basis $ 23,625,084 25,489,809 27,441,514 $ 28,034,208 $ 25,216,611 $ 23,625,084 $ 25,216,611 Less: Guaranteed portion of student loans 1,274,453 889,963 448,648 334,847 152,135 1,274,453 152,135 Total Loans excluding guaranteed portion of student loans $ 22,350,631 $ 24,599,846 $ 26,992,866 $ 27,699,361 $ 25,064,476 $ 22,350,631 $ 25,064,476

Average Total Loans GAAP Basis $ 23,835,598 $ 26,380,203 $ 28,257,484 $ 27,733,143 $ 22,945,494 $ 26,552,574 $ 21,348,493 Securitization Adjustments 26,755,248 24,590,853 22,875,277 24,144,702 27,761,596 24,588,040 27,662,655 Managed Basis $ 50,590,846 $ 50,971,056 $ 51,132,761 $ 51,877,845 $ 50,707,090 $ 51,140,614 $ 49,011,148

Interest Yield GAAP Basis 10.25 % 12.10 % 11.54 % 11.24 % 11.36 % 11.31 % 10.89 % Securitization Adjustments 14.21 % 13.40 % 13.00 % 13.24 % 13.71 % 13.49 % 13.93 % Managed Basis 12.34 % 12.73 % 12.19 % 12.17 % 12.65 % 12.36 % 12.61 % Net Yield on Loan Receivables GAAP Basis 5.45 % 7.95 % 7.55 % 7.36 % 7.12 % 7.13 % 6.58 % Securitization Adjustments 12.87 % 11.98 % 11.37 % 11.13 % 9.76 % 11.87 % 10.07 % Managed Basis 9.37 % 9.90 % 9.26 % 9.11 % 8.56 % 9.41 % 8.55 % Net Principal Charge-off Rate GAAP Basis 7.98 % 8.05 % 7.53 % 6.34 % 5.25 % 7.45 % 4.59 % Securitization Adjustments 8.83 % 8.77 % 8.11 % 6.65 % 5.68 % 8.12 % 5.32 % Managed Basis 8.43 % 8.39 % 7.79 % 6.48 % 5.48 % 7.77 % 5.01 % Delinquency Rate (over 30 days) GAAP Basis 4.92 % 4.86 % 4.87 % 5.04 % 4.35 % 4.92 % 4.35 % Securitization Adjustments 5.65 % 5.35 % 5.32 % 5.52 % 4.77 % 5.65 % 4.77 % Managed Basis 5.31 % 5.10 % 5.08 % 5.25 % 4.56 % 5.31 % 4.56 % Delinquency Rate (over 90 days) GAAP Basis 2.58 % 2.46 % 2.60 % 2.57 % 2.06 % 2.58 % 2.06 % Securitization Adjustments 2.95 % 2.74 % 2.88 % 2.83 % 2.27 % 2.95 % 2.27 % Managed Basis 2.78 % 2.60 % 2.73 % 2.69 % 2.17 % 2.78 % 2.17 % Credit Card Loans Credit Card Loans GAAP Basis $ 20,230,302 $ 22,721,603 $ 25,312,764 $ 26,156,681 $ 23,814,307 $ 20,230,302 $ 23,814,307 Securitization Adjustments 27,235,288 25,414,036 23,590,868 22,854,496 25,878,667 27,235,288 25,878,667 Managed Basis $ 47,465,590 $ 48,135,639 $ 48,903,632 $ 49,011,177 $ 49,692,974 $ 47,465,590 $ 49,692,974

Average Credit Card Loans GAAP Basis $ 20,674,527 $ 24,051,037 $ 26,233,044 $ 26,109,533 $ 21,658,816 $ 24,266,782 $ 20,566,864 Securitization Adjustments 26,755,248 24,590,853 22,875,277 24,144,702 27,761,596 24,588,040 27,662,655 Managed Basis $ 47,429,775 $ 48,641,890 $ 49,108,321 $ 50,254,235 $ 49,420,412 $ 48,854,822 $ 48,229,519

Discover Financial Services Reconciliation of GAAP to Managed Data 8 (unaudited, dollars in thousands) Quarter Ended Year Ended Nov 30, 2009 Aug 31, 2009 May 31, 2009 Feb 28, 2009 Nov 30, 2008 Nov 30, 2009 Nov 30, 2008 Interest Yield GAAP Basis 10.86 % 12.56 % 11.81 % 11.39 % 11.45 % 11.69 % 10.92 % Securitization Adjustments 14.21 % 13.40 % 13.00 % 13.24 % 13.71 % 13.49 % 13.93 % Managed Basis 12.75 % 12.99 % 12.37 % 12.28 % 12.72 % 12.59 % 12.65 % Net Principal Charge-off Rate GAAP Basis 8.77 % 8.48 % 7.88 % 6.58 % 5.47 % 7.87 % 4.73 % Securitization Adjustments 8.83 % 8.77 % 8.11 % 6.65 % 5.68 % 8.12 % 5.32 % Managed Basis 8.81 % 8.63 % 7.99 % 6.61 % 5.59 % 8.00 % 5.07 % Delinquency Rate (over 30 days) GAAP Basis 5.52 % 5.27 % 5.15 % 5.32 % 4.55 % 5.52 % 4.55 % Securitization Adjustments 5.65 % 5.35 % 5.32 % 5.52 % 4.77 % 5.65 % 4.77 % Managed Basis 5.60 % 5.31 % 5.23 % 5.41 % 4.66 % 5.60 % 4.66 % Delinquency Rate (over 90 days) GAAP Basis 2.92 % 2.70 % 2.77 % 2.73 % 2.16 % 2.92 % 2.16 % Securitization Adjustments 2.95 % 2.74 % 2.88 % 2.83 % 2.27 % 2.95 % 2.27 % Managed Basis 2.94 % 2.72 % 2.82 % 2.78 % 2.22 % 2.94 % 2.22 % Return on Loan Receivables GAAP Basis 6.24 % 8.68 % 3.17 % 1.76 % 7.78 % 4.87 % 4.98 % Securitization Adjustments 5.56 % 9.32 % 3.92 % 2.02 % 6.43 % 5.26 % 3.84 % Managed Basis 2.94 % 4.49 % 1.75 % 0.94 % 3.52 % 2.53 % 2.17 %