Capital One gets green light to buy Discover for $35B and form credit card giant

Merger Approval - The merger between Capital One and Discover Financial Services has received regulatory approval, moving the $35 billion deal closer to completion [1][3] - The Federal Reserve and the Office of the Comptroller of the Currency have signed off on the deal, which was initially announced in February 2024 [1][3] Regulatory Actions - The Federal Reserve imposed a$100 million fine on Discover for overcharging certain interchange fees from 2007 to 2023, which Discover has since terminated and is repaying affected customers [1][2] - Capital One has committed to comply with the Federal Reserve's actions against Discover as a condition of the merger approval [3] Industry Context - The merger combines two of the largest non-bank credit card companies, positioning them to compete more effectively against the Visa-Mastercard duopoly [4][6] - The deal will enhance Discover's payment network by providing a significant credit card partner, potentially revitalizing its competitive stance in the market [5][6] - Both companies primarily serve customers seeking cash back or modest travel rewards, indicating a similar target demographic [5][7]