NEW YORK (Reuters) – The Federal Reserve and Office of the Comptroller of the Currency said on Friday they have approved the merger of Capital One and Discover, clearing the last major hurdles for a tie-up between the two banks.
The regulators said they have done a “fulsome review” of the banks’ 2024 application, approving a deal set to create the biggest U.S. credit card issuer by balances and one of the largest banks by assets. It also will give Capital One control of Discover’s card payment network.
OCC’s approval is conditioned on plans for corrective actions to address the “root causes” of any outstanding enforcement actions against Discover Bank, the regulator said.
The Fed said in its statement it has entered a consent order with Discover and assessed a fine of $100 million for overcharging certain fees from 2007-2023.
The Justice Department previously concluded there were not competition concerns sufficient enough to block the deal, according to news reports.
Financial executives have seen the deal as a litmus test for how quickly the Trump administration will approve mergers in an industry that has long been ripe for consolidation.
(Reporting by Chris Prentice; Additional reporting by Saeed Azhar, Editing by Franklin Paul)