FOR IMMEDIATE RELEASE: April 4, 2025

CONTACT:
Jimmy Wyderko jwyderko@economicliberties.us 
Carter Dougherty, carter@ourfinancialsecurity.org
Alan Pyke, apyke@ncrc.org

Organizations Urge Justice, Banking Regulators to Block Capital One-Discover Merger
Anticompetitive impacts harm consumers, small businesses, and communities

WASHINGTON, DC — Today, American Economic Liberties Project, Americans for Financial Reform Education Fund, National Community Reinvestment Coalition, and Public Citizen sent a letter to the U.S. Department of Justice, the Federal Reserve Board, and the Office of the Comptroller of the Currency (OCC) urging them to block the proposed Capital One-Discover merger under federal antitrust and banking statutes.

The letter is available here.

The merger would create the sixth largest bank by assets and the largest credit card lender to people with non-prime credit scores, constituting more than 30 percent of the outstanding loans to these borrowers. Further, the merger would combine Capital One’s banking business with Discover’s credit and debit networks, creating vertical market power that would harm merchants and, in turn, consumers.

“Capital One banks on the fact that many of their customers don’t have the ability to switch credit cards because of their credit score,” said Jesse Van Tol, president and CEO of NCRC. “Capital One takes advantage of that and charges some of the highest interest rates of the country, and if they acquire Discover they will have even less incentive to compete on the cost of their main product. This merger was a horrible idea for working class families when it was announced last year, and with rising prices it’s now an absolute nightmare.”

The merger was announced more than 14 months ago but the Justice Department and federal banking regulators are still evaluating the antitrust and banking statutory considerations. The Justice Department is required by law to submit a competitive factors report to the banking regulators with supervisory jurisdiction over the specific merging banking institutions.

“It’s almost impossible to believe that the Antitrust Division could not recognize the clear competition concerns at play here,” said Morgan Harper, director of policy and advocacy at the American Economic Liberties Project. “But if that’s true, they should release the competitive factors report to the public and prove how they came to that conclusion. Publicly available information shows that Capital One will accrue a massive market share in a variety of critical financial markets if the deal goes through, which is of direct interest to the millions of Americans that will harm.”

The Federal Reserve and OCC must evaluate the anticompetitive effects of the merger, based on the guidance from the Justice Department, as well as the impacts on systemic risk, compliance with consumer protection and other regulations, and meeting the needs of communities under the Bank Holding Company Act and Bank Merger Act. The banks have a long and checkered record of failing to comply with consumer protection laws, including a recent Consumer Financial Protection Bureau suit against Capital One for deceptively marketing savings accounts that reduced interest earnings of depositors by billions of dollars.

“America cannot afford another mega-bank,” said Bartlett Naylor, financial policy advocate for Public Citizen. “Bailouts from 2008 and 2023 crashes must inform merger policy.”

Recent reporting has also suggested that state attorneys general are considering acting on the proposed merger. New York has sought documents to evaluate the merger and other states are purportedly considering joining in the efforts.

“It is time for the states to step up and protect people from a hyperconsolidated banking system that raises prices for consumers and small businesses and reduces community investments,” said Patrick Woodall, managing director for policy at Americans for Financial Reform Education Fund. “The states should sue to block this merger and fill the vacuum created by the current administration’s retreat on antitrust enforcement.”

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