Updates share prices throughout.

Discover Financial Services ( DFS) shares were falling after an initial bounce Wednesday, after the company on late Tuesday priced a public stock offering it hoped would raise as much as $552 million it may use to repay government bailout money.

The Riverwoods, Ill.-based credit card company offered 54 million shares of common stock at $9.25 a share, a 1.3% discount to Tuesday's closing price of $9.37 a share. Discover said it plans to receive between $480 million and $552 million in net proceeds from the offering, depending on if the underwriters choose to exercise the full over-allotment option of 8.1 million shares. The offering is expected to close on July 13.

Discover said on Monday the proceeds may be used for capital contributions for its bank subsidiary or for the repurchase of the federal government's $1.2 billion preferred equity investment made in March through the Troubled Asset Relief Program, or TARP.

After initiating their own stock offerings, other credit card firms including American Express ( AXP) and Capital One Financial ( COF) have been able to repay TARP investments.

Discover shares, which jumped as much as 3.4% Wednesday, were recently trading down 3.4% to $9.05.