Capital One Advances Discover Acquisition Post Justice Nod

Capital One Financial is advancing with its $35 billion acquisition of Discover Financial Services following a favorable review from the Department of Justice, which found no major competition concerns. The merger plan, which came under scrutiny for its potential impact on consumers lacking credit histories, has been under investigation since the Biden administration and continued into the Trump era. Despite the justice watchdog’s inability to approve the merger outright, its decision not to block it marks a significant step forward; the Federal Reserve and the Office of the Comptroller of the Currency still hold the power to stop it. This review comes in the context of heightened scrutiny with the introduction of tighter merger evaluation guidelines during the Biden administration. With Capital One's existing $479 billion assets and Discover's 305 million cardholder network, this acquisition promises to enhance Capital One’s customer base. Shareholders have already greenlit the all-stock deal, with completion expected within the year pending regulatory approval. Formal rejection of bank merger applications has not occurred since 2003, adding further weight to this development.