Discover Financial Services Announces Pricing Terms Of Exchange Offers

Discover Financial Services (the “Company”) (NYSE: DFS) announced today the pricing terms of its private offers to exchange its outstanding notes referenced in the table below (collectively, the “Old Notes”) for new Senior Notes due 2022 (the “New Notes”) and cash (the “Exchange Offers”), determined as of 2:00 p.m., New York City time, on April 20, 2012 (the “Price Determination Date”) in accordance with the terms set out in the Company’s confidential offering memorandum dated April 9, 2012 (the “Confidential Offering Memorandum”) and the related letter of transmittal.

The total exchange price to be received in each Exchange Offer (the “Total Exchange Prices”) for each $1,000 principal amount of Old Notes validly tendered, and not validly withdrawn, prior to 5:00 p.m., New York City time, on April 20, 2012 (the “Early Participation Date”) are set forth in the table below. The Total Exchange Prices include the early exchange premium of $50 per $1,000 principal amount of Old Notes (the “Early Exchange Premium”) validly tendered, and not validly withdrawn, prior to the Early Participation Date. The Total Exchange Prices have been determined in accordance with the procedures set forth in the Confidential Offering Memorandum. Holders of Old Notes who validly tender Old Notes after the Early Participation Date and whose Old Notes are accepted in the Exchange Offers will receive the Total Exchange Prices less the Early Exchange Premium (the “Exchange Price”).

The table below shows the Total Exchange Prices and Exchange Prices per $1,000 principal amount of each series of Old Notes accepted in the Exchange Offers.

Fixed

Principal

Reference

Spread

Maximum

Early

Total

CUSIP

Title of

Amount

UST

(basis

Acceptance

Exchange

Exchange

Exchange

Number

Security

Outstanding

Yield

points)

Limit

Premium

Price

Price

Any and All Offer

254709AE8

10.250%SeniorNotes due2019 (the“10.250%Notes”)

$400,000,000

1.966%

+ 245

N/A

$50.00

$1,307.05

$1,357.05

Maximum Offer

254709AD0254709AB4

6.450%SeniorNotes due2017 (the“6.450%Notes”)

$400,000,000

0.841%

+ 265

$50,000,000

$50.00

$1,086.97

$1,136.97

The Total Exchange Prices will be paid in the following manner:

• $1,000 principal amount of New Notes; plus,
• A cash amount equal to (a) the Total Exchange Price of the series of outstanding Old Notes tendered minus (b) the New Notes Value (as defined below).

The Exchange Prices will be paid in the following manner:

• $1,000 principal amount of New Notes; plus,
• A cash amount equal to (a) the Exchange Price of the series of outstanding Old Notes tendered minus (b) the New Notes Value.

In addition to the applicable Total Exchange Price or Exchange Price, holders whose Old Notes are accepted for exchange will be paid accrued and unpaid interest on such Old Notes to but not including the applicable settlement date, described below.

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