December 2021 Call Report (FRY 9-C)

Last Update: 20220214.073139

Board of Governors of the Federal Reserve System

RSSD ID: 3846375

FR Y-9C

OMB Number 7100-0128

Approval expires December 31, 2024 Page 1 of 76

Consolidated Financial Statements for

Holding Companies-FRY-9C

Report at the close of business as of the last calendar day of the quarter

This Report is required by law: Section 5(c) of the BHC Act	companies meeting certain criteria must file this report (FR Y-9C)
(12 U.S.C. § 1844(c)), section 10 of Home Owners' Loan Act	regardless of size. See page 1 of the general instructions for fur-
(HOLA) (12 U.S.C. § 1467a(b)), section 618 of the Dodd-Frank Act	ther information. However, when such holding companies own or
(12 U.S.C. § 1850a(c)(1)), section 165 of the Dodd-Frank Act	control, or are owned or controlled by, other holding companies,
(12 U.S.C. § 5365), and section 252.153(b)(2) of Regulation YY	only the top-tier holding company must file this report for the con-
(12 CFR 252.153(b)(2)).	solidated holding company organization. The Federal Reserve
This report form is to be filed by holding companies with total	may not conduct or sponsor, and an organization (or a person) is
not required to respond to, a collection of information unless it dis-
consolidated assets of $3 billion or more. In addition, holding	plays a currently valid OMB control number.

NOTE: Each holding company's board of directors and senior man-	Date of Report: December 31, 2021
agement are responsible for establishing and maintaining an effec-		Month / Day / Year (BHCK 9999)
tive system of internal control, including controls over the
Consolidated Financial Statements for Holding Companies. The
Consolidated Financial Statements for Holding Companies is to be
prepared in accordance with instructions provided by the Federal
Reserve System. The Consolidated Financial Statements for Holding
Companies must be signed and attested by the Chief Financial
Officer (CFO) of the reporting holding company (or by the individual
performing this equivalent function).
I, the undersigned CFO (or equivalent) of the named holding
company, attest that the Consolidated Financial Statements for
Holding Companies (including the supporting schedules) for this
report date have been prepared in conformance with the instruc-
tions issued by the Federal Reserve System and are true and
correct to the best of my knowledge and belief.
John T. Greene	DISCOVER FINANCIAL SERVICES

Printed Name of Chief Financial Officer (or Equivalent) (BHCK C490)

Signature of Chief Financial Officer (or Equivalent) (BHCK H321)

Legal Title of Holding Company (RSSD 9017)

2500 LAKE COOK ROAD

(Mailing Address of the Holding Company) Street / PO Box (RSSD 9110)

02/11/2022		RIVERWOODS		IL		60015
Date of Signature (MM/DD/YYYY) (BHTX J196)		City (RSSD 9130)		State (RSSD 9200) Zip Code (RSSD 9220)

Is confidential treatment requested for any	0=No	BHCK
..................portion of this report submission?	1=Yes	C447	0

In accordance with the General Instructions for this report (check only one),

1. a letter justifying this request is being provided along

with the report (BHCK KY38) ........................................

2. a letter justifying this request has been provided

separately (BHCK KY38) .............................................

For Federal Reserve Bank Use Only

RSSD ID

C.I.S.F.

Person to whom questions about this report should be directed:

Thomas L. Bonifas, Director

Name / Title (BHTX 8901)

224-405-1082

Area Code / Phone Number (BHTX 8902)

224-405-3542

Area Code / FAX Number (BHTX 9116)

[email protected]

E-mail Address of Contact (BHTX 4086)

Holding companies must maintain in their files a manually signed and attested printout of the data submitted.

Public reporting burden for this information collection is estimated to vary from 5 to 1,250 hours per response, with an average of 44.79 hours per response for non-Advanced Approaches holding companies with $5 billion or more and an average of 35.59 hours per response for non-Advanced Approaches holding companies with less than $5 billion in total assets and 49.80 hours for Advanced Approaches holding companies, including time to gather and maintain data in the required form and to review instructions and complete the information collection. Comments regarding this burden estimate or any other aspect of this information collection, including suggestions for reducing the burden, may be sent to Secretary, Board of Governors of the Federal Reserve

System, 20th and C Streets, NW, Washington, DC 20551, and to the Office of Management and Budget, Paperwork Reduction Project (7100-0128), Washington, DC 20503.

12/2021

Last Update: 20220214.073139	RSSD ID: 3846375
	FR Y-9C
	Page 2 of 76

Chief Executive Officer Contact Information

This information is being requested so the Board can distribute notifications about policy initiatives and other matters directly to the Chief Executive Officers of reporting institutions. Please provide contact information for the Chief Executive Officer of the reporting institution. Enter "none" for the Chief Executive Officer's email address if not available. Chief Executive Officer contact information is for the confidential use of the Board and will not be released to the public.

Chief Executive Officer

Name (BHCK FT42)

Area Code / Phone Number / Extension (BHCK FT43)

E-mail Address (BHCK FT44)

12/2021

Last Update: 20220214.073139		RSSD ID: 3846375
			FR Y-9C
	For Federal Reserve Bank Use Only
	Page 3 of 76

	RSSD ID
	S.F.

Report of Income for Holding Companies

Report all Schedules of the Report of Income on a calendar year-to-date basis.

Schedule HI-Consolidated Income Statement

Dollar Amounts in Thousands	BHCK	Amount
1. Interest income
a. Interest and fee income on loans:
(1) In domestic offices:
...............................................(a) Loans secured by 1- 4 family residential properties	4435	112915
(b) All other loans secured by real estate.................................................................	4436	0
(c) All other loans ...............................................................................................	F821	10691374
(2) In foreign offices, Edge and Agreement subsidiaries, and IBFs ....................................	4059	0
b. Income from lease financing receivables.....................................................................	4065	0
c. Interest income on balances due from depository institutions1 .........................................	4115	17718
d. Interest and dividend income on securities:
(1) U.S. Treasury securities and U.S. government agency obligations
(excluding mortgage-backed securities)..................................................................	B488	172468
(2) Mortgage-backed securities .................................................................................	B489	9780
(3) All other securities..............................................................................................	4060	178
e. Interest income from trading assets2 ..........................................................................	4069	0
f. Interest income on federal funds sold and securities purchased under agreements
to resell................................................................................................................	4020	0
g. Other interest income .............................................................................................	4518	165
h. Total interest income (sum of items 1.a through 1.g) ......................................................	4107	11004598
2. Interest expense
a. Interest on deposits:
(1) In domestic offices:
(a) Time deposits of $250,000 or less .....................................................................	HK03	408380
(b) Time deposits of more than $250,000 ................................................................	HK04	26240
(c) Other deposits...............................................................................................	6761	209475
(2) In foreign offices, Edge and Agreement subsidiaries, and IBFs ....................................	4172	0
b. Expense on federal funds purchased and securities sold under agreements to repurchase ...	4180	1
c. Interest on trading liabilities and other borrowed money2
(excluding subordinated notes and debentures) ...........................................................	4185	455982
d. Interest on subordinated notes and debentures and on mandatory convertible
securities2 ............................................................................................................	4397	17461
e. Other interest expense............................................................................................	4398	0
f. Total interest expense (sum of items 2.a through 2.e) ....................................................	4073	1117539
3. Net interest income (item 1.h minus item 2.f)...................................................................	4074	9887059
4. Provision for loan and lease losses3 ..............................................................................	JJ33	217775
5. Noninterest income:
a. Income from fiduciary activities .................................................................................	4070	0
b. Service charges on deposit accounts in domestic offices................................................	4483	1910
c. Trading revenue2, 4..................................................................................................	A220	0

1.a.(1)(a)

1.a.(1)(b)

1.a.(1)(c)

1.a.(2)

1.b.

1.c.

1.d.(1)

1.d.(2)

1.d.(3)

1.e.

1.f.

1.g.

1.h.

2.a.(1)(a)

2.a.(1)(b)

2.a.(1)(c)

2.a.(2)

2.b.

2.c.

2.d.

2.e.

2.f.

5.a.

5.b.

5.c.

Includes interest income on time certificates of deposit not held for trading.
To be completed by holding companies with $5 billion or more in total assets. (For theasset-sizetest for report dates through December 31, 2021, a holding company may use the lesser of the total assets reported in its FRY-9Creport as ofDecember 31, 2019, orJune 30, 2020). Income and or expenses pertaining to these items should be reported in the "other" categories 1.g, 2.e, and 5.l, respectively by holding companies with less than $5 billion in total assets.
Institutions that have adopted ASU 2016-13 should report in item 4, the provisions for credit losses for all financial assets andoff-balancesheet credit exposures that fall within the scope of the standard.
For holding companies required to complete Schedule HI, memoranda item 9, trading revenue reported in Schedule HI, item 5.c must equal the sum of memoranda items 9.a through 9.e.

03/2021

Last Update: 20220214.073139	RSSD ID: 3846375
	FR Y-9C
	Page 4 of 76

Schedule HI-Continued

Dollar Amounts in Thousands	BHCK	Amount
Holding companies with less than $5 billion in total assets should report data items 5.d.(6) and
5.d.(7) only and leave 5.d.(1) through 5.d.(5) blank.
5. d. Income from securities-related and insurance activities:
(1) Fees and commissions from securities brokerage ....................................................	C886	0
(2) Investment banking, advisory, and underwriting fees and commissions.........................	C888	0
(3) Fees and commissions from annuity sales..............................................................	C887	0
(4) Underwriting income from insurance and reinsurance activities ...................................	C386	0
(5) Income from other insurance activities ...................................................................	C387	60480
(6) Fees and commissions from securities brokerage, investment banking, advisory, and
underwriting fees and commissions .......................................................................	KX46
(7) Income from insurance activities5 .........................................................................	KX47
..........................................................................................e. Venture capital revenue6	B491	0
..................................................................................................f. Net servicing fees	B492	0
........................................................................................g. Net securitization income6	B493	0
h. Not applicable.
i. Net gains (losses) on sales of loans and lease .............................................................	8560	0
j. Net gains (losses) on sales of other real estate owned...................................................	8561	-5
k. Net gains (losses) on sales of other assets7 .................................................................	B496	142
l. Other noninterest income8........................................................................................	B497	1700366
m. Total noninterest income (sum of items 5.a through 5.l)..................................................	4079	1762893
6. a. Realized gains (losses) on held-to-maturity securities....................................................	3521	0
b. Realized gains (losses) on available-for-saledebt securities...........................................	3196	8
7. Noninterest expense:
a. Salaries and employee benefits ................................................................................	4135	2022951
b. Expenses of premises and fixed assets (net of rental income)
(excluding salaries and employee benefits and mortgage interest) ...................................	4217	186299
c. (1) Goodwill impairment losses .................................................................................	C216	0
(2) Amortization expense and impairment losses for other intangible assets .......................	C232	1060
d. Other noninterest expense9 ......................................................................................	4092	2581346
e. Total noninterest expense (sum of items 7.a through 7.d) ...............................................	4093	4791656
8. a. Income (loss) before change in net unrealized holding gains (losses) on equity securities
not held for trading, applicable income taxes, and discontinued operations
(sum of items 3, 5.m, 6.a, 6.b, minus items 4 and 7.e) ...................................................	HT69	6640529
b. Change in net unrealized holding gains (losses) on equity securities not held for trading10....	HT70	423311
c. Income (loss) before applicable income taxes and discontinued operations
(sum of items 8.a and 8.b) .......................................................................................	4301	7063840
9. Applicable income taxes (on item 8.c)............................................................................	4302	1615124
10. Income (loss) before discontinued operations (item 8.c minus item 9) .....................................	4300	5448716
11. Discontinued operations, net of applicable income taxes11 ..................................................	FT28	0
12. Net income (loss) attributable to holding company and noncontrolling
(minority) interests (sum of items 10 and 11) ...................................................................	G104	5448716
13. LESS: Net income (loss) attributable to noncontrolling (minority) interests
(if net income, report as a positive value; if net loss, report as a negative value) .....................	G103	0
14. Net income (loss) attributable to holding company (item 12 minus item 13) ...........................	4340	5448716

5. Includes underwriting income from insurance and reinsurance activities.

6. To be completed by holding companies with $5 billion or more in total assets (For theasset-sizetest for report dates through

December 31, 2021, a holding company may use the lesser of the total assets reported in its FR Y-9C report as of

December 31, 2019, orJune 30, 2020). Income and or expenses pertaining to these items should be reported in the "other" categories.

7. Excludes net gains (losses) on sales of trading assets and held-to-maturity and available-for-saledebt securities.

8. See Schedule HI, memoranda item 6.

9. See Schedule HI, memoranda item 7.

10. Item 8.b is to be completed by all holding companies. See the instructions for this item and the Glossary entry for "Securities Activities" for further detail on accounting for investments in equity securities.

11. Describe on Schedule HI, memoranda item 8.

5.d.(1)

5.d.(2)

5.d.(3)

5.d.(4)

5.d.(5)

5.d.(6)

5.d.(7)

5.e.

5.f.

5.g.

5.i.

5.j.

5.k.

5.l.

5.m.

6.a.

6.b.

7.a.

7.b.

7.c.(1)

7.c.(2)

7.d.

7.e.

8.a.

8.b.

8.c.

10.

11.

12.

13.

14.

03/2021

Last Update: 20220214.073139	RSSD ID: 3846375
	FR Y-9C
	Page 5 of 76

Schedule HI-Continued

Memoranda

		Dollar Amounts in Thousands	BHCK	Amount
Memo Items 1 and 2 are to be reported by holding companies with $5 billion or more in
total assets.1
1. Net interest income (item 3 above) on a fully taxable equivalent basis .................................	4519	9887059
2. Net income before applicable income taxes, and discontinued operations (item 8.c above)
................................................................................on a fully taxable equivalent basis	4592	7063840
3. Income on tax-exempt loans and leases to states and political subdivisions in the U.S.
........................................................(included in Schedule HI, items 1.a and 1.b, above)	4313	0
4. Income on tax-exempt securities issued by states and political subdivisions in the U.S.
................................................................(included in Schedule HI, item 1.d.(3), above)	4507	0
5. Number of full-time equivalent employees at end of current period	BHCK	Number
.................................................................................(round to nearest whole number)	4150	15959
Memo Items 6.a through 6.j are to be completed annually on a calendar year-to-date basis in the
December report only by holding companies with less than $5 billion in total assets. Holding
companies with $5 billion or more in total assets should report these items on a quarterly basis.1
6. Other noninterest income (from Schedule HI, item 5.l, above) (only report amounts greater
than $100,000 that exceed 7 percent of Schedule HI, item 5.l):	BHCK	Amount
...................................................a. Income and fees from the printing and sale of checks	C013	0
............................b. Earnings on/increase in value of cash surrender value of life insurance	C014	0
..............................................c. Income and fees from automated teller machines (ATMs)	C016	0
....................................................d. Rent and other income from other real estate owned	4042	0
e. Safe deposit box rent.............................................................................................	C015	0
f. Bank card and credit card interchange fees ................................................................	F555	1224197
g. Income and fees from wire transfers .........................................................................	T047	0
	TEXT	Net credit card fee income
h.	8562		8562	214996
	TEXT	Transaction processing revenue
i.	8563		8563	177867
	TEXT
j.	8564		8564
Memo Items 7.a through 7.p are to be completed annually on a calendar year-to-date basis in the
December report only by holding companies with less than $5 billion in total assets. Holding
companies with $5 billion or more in total assets should report these items on a quarterly basis.1
7. Other noninterest expense (from Schedule HI, item 7.d, above) (only report amounts greater
than $100,000 that exceed 7 percent of the sum of Schedule HI, item 7.d):
a. Data processing expenses......................................................................................	C017	0
b. Advertising and marketing expenses.........................................................................	0497	807791
c. Directors' fees ......................................................................................................	4136	0
d. Printing, stationery, and supplies ..............................................................................	C018	0
e. Postage ..............................................................................................................	8403	0
f. Legal fees and expenses........................................................................................	4141	0
g. FDIC deposit insurance assessments2.......................................................................	4146
h. Accounting and auditing expenses ...........................................................................	F556	0
i. Consulting and advisory expenses ...........................................................................	F557	285778
j. Automated teller machine (ATM) and interchange expenses ..........................................	F558	0
................................................................................k. Telecommunications expenses	F559	0
l. Other real estate owned expenses ...........................................................................	Y923	0

1. For the asset-size test for report dates through December 31, 2021, a holding company may use the lesser of the total assets reported in its FR Y-9C report as of December 31, 2019, or June 30, 2020.

2. Amounts reported in Memorandum item 7.g will not be made available to the public on an individual institution basis.

M.1.

M.2.

M.3.

M.4.

M.5.

M.6.a.

M.6.b.

M.6.c.

M.6.d.

M.6.e.

M.6.f.

M.6.g.

M.6.h.

M.6.i.

M.6.j.

M.7a.

M.7.b.

M.7.c.

M.7.d.

M.7.e.

M.7.f.

M.7.g.

M.7.h. M.7. i. M.7. j. M.7.k. M.7. l.

09/2021

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Discover Financial Services published this content on 24 February 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 February 2022 14:13:10 UTC.

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