Discover Financial Services’ move to lay off more than 100 people in north suburban Riverwoods is unrelated to Capital One’s $35 billion acquisition of the credit card issuer, the company said.
Richard Drew/AP
Discover Financial Services, based in north suburban Riverwoods, will lay off 108 employees starting March 18. But the move is unrelated to Capital One’s $35 billion acquisition of the credit card issuer, which was announced this week, a Discover spokesperson said.
The company cited a mass layoff as the reason for the job cuts in its Jan. 18 filing under the Illinois Worker Adjustment and Retraining Notification Act. The Lake County firm did not disclose which positions would be eliminated.
Discover, the 33rd largest U.S. bank, has nearly 20,000 employees, with more than 5,000 in the Chicago area.
“We intend to remain committed to Chicagoland and into our national servicing presence,” said Michael Rhodes, Discover’s chief executive, on a conference call Tuesday. The deal with Capital One is expected to close by the end of 2024. Rhodes then plans to stay on in an advisory capacity for a year.
Virginia-based Capital One, the 12th largest bank in the U.S., on Tuesday announced it will buy Discover in an all-stock transaction valued at $35.3 billion.
The combined company will serve more than 100 million customers.
Across the U.S, credit card debt continues to climb, according to a report this month from the Federal Reserve Bank of New York. Total credit card balances increased by $50 billion to $1.13 trillion in the fourth quarter of 2023 — the highest level since the Fed’s report started in 2003.
Discover was launched in 1985 by Phil Purcell, a graduate of University of Chicago Booth School of Business and former chief executive of Morgan Stanley.
In the latest round of layoffs to hit the Chicago area, Tribune Publishing announced last week that it will cut 198 workers starting in late April as it prepares to close its printing plant, the Freedom Center, by the summer.
The River West site was bought last year by Bally’s to house its new casino. The Tribune will move newspaper publishing to its suburban facility in Schaumburg, which also prints the Chicago Sun-Times and the Daily Herald.