Discover lower after earnings miss

• Q4 net income of $500M or $1.14 per share vs. $404M and $0.87 one year ago.
• Direct Banking pretax income of $767M up 19% Y/Y, but fell after excluding last year's one-time items. Total loans of $72.4B up 3.5%. Credit card loans of $57.9B up 3.1%. Personal loans up 9.6%, Private student loans up 3%. Net interest income up 4%, with NIM of 9.75% down two basis points. Delinquency rate of 1.72% down one basis points from a year ago, up seven basis points from last quarter. Loan loss provision of $486M up $32M. Expenses up 3% Y/Y thanks to regulatory and compliance costs.
• Payment Services pretax income of $21M up sharply from last year which included a $21M charge. Transaction dollar volume of $45.9B down 10%. PULSE transaction dollar volume fell 14% thanks to the loss of volume from a large debit issuer.
• 8M shares bought back during quarter for $435M. Float fell by 1.8%.
• Conference call at 5 ET
• Previously: Discover Financial Services misses by $0.16, misses on revenue (Jan. 27)
• DFS -2.9% after hours