Discover Shares Up on 3Q Net Jump

RIVERWOOD, Ill. (TheStreet) -- Discover Financial Services(DFS Quote) shares were moving higher in the late morning following news that the credit card operation tripled its net income during the third quarter -- though most of the brighter outcome was fueled by a settlement payment and expense slashing.

On Thursday, Discover said in a press release that its bottom-line surged to $577.5 million, or $1.07 per share. At the same time last year, net income tracked at $180.1 million, or 37 cents per share.

But a $287 million settlement payment boosted the third quarter showing tied to Discover's antitrust suit against Visa(V Quote) and MasterCard(MA Quote) that ended last fall.

Shares were moving higher by 48 cents, or 3.1%, at $15.80.

Sales volume on Discover Cards dipped 7%, though expenses were also restrained by 14% while U.S. card income climbed to $913 million.

Still, recession pressures continued popping up during the quarter, though some figures improved sequentially. In managed-basis calculations, which account for securitized loans, net charge-offs were up to 8.39% in the third quarter from 5.20% in the year-earlier period. That helped boost the provision for loan losses by 23% from a year-ago to $924.4 million during the third quarter, though that's still lower than the $1.11 billion from the immediately preceding quarter.