There could be a new, largest credit card company in the United States. The Board of Governors of the Federal Reserve and the Office of the Comptroller of the Currency announced Friday thatcapital oneBank (Capital One) has been approved to acquireDiscover financial servicesCompany (Discover Financial Services) and merged with it.
The all-stock deal, first announced more than a year ago, would, if completed, give Capital One a significant advantage over rival credit card-issuing banks such as JPMorgan Chase, Bank of America and Citigroup, which don't handle transactions themselves.
It would also create a new revenue stream for Capital One from the merchant fees it charges.
The Trump administration is largely seen as more friendly to corporate mergers. Shares of Capital One Bank and Discovery Financial Services rose immediately after Trump won the election in November, as did stocks of other companies that were trying to merge or had previously called off merger deals altogether.