<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 18, 1996
Dean Witter, Discover & Co.
- --------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Delaware 1-11758 36-3145972
- --------------------------------------------------------------------------------
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
Two World Trade Center, New York, New York 10048
--------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:(212) 392-2222
--------------
- --------------------------------------------------------------------------------
(Former name or address, if changed since last report.)
<PAGE>
ITEM 5. OTHER EVENTS
---------------------
On July 18, 1996, Dean Witter, Discover & Co. (the "Registrant")
released financial information with respect to the quarter and six months
ended June 30, 1996. A copy of the press release containing such financial
information is annexed as Exhibit 99.1 to this Report and by this reference
incorporated herein and made a part hereof.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
---------------------------------------------------------------------------
99.1 Press release of the Registrant dated June 18, 1996 containing
financial information for the quarter and six months ended June
30, 1996.
-2-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereto duly authorized.
DEAN WITTER, DISCOVER & CO.
---------------------------
(Registrant)
By: /s/ Ronald T. Carman
------------------------
Ronald T. Carman
Senior Vice President
Dated: July 18, 1996
-3-
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
DEAN WITTER, DISCOVER & CO.
EXHIBITS
TO CURRENT REPORT ON
FORM 8-K DATED JULY 18, 1996
Commission File Number 1-11758
-4-
<PAGE>
Exhibit Index
-------------
Exhibit No. Description
- ----------- -----------
99.1 Press release of the Registrant dated
July 18, 1996 containing financial
information for the quarter and six months
ended June 30, 1996.
-5-
<PAGE>
EXHIBIT 99.1
-6-
<PAGE>
EXHIBIT 99.1
July 18, 1996 Timothy Lee
Corporate Communications
212-392-8709
Amy Pappas
Investor Relations
212-392-6171
DWD SECOND QUARTER EARNINGS: $238.8 MILLION;
SIX-MONTH EARNINGS A RECORD $484.6 MILLION
NEW YORK, July 18 -- Dean Witter, Discover & Co. today reported second quarter
net income of $238.8 million, compared to $237.5 million for the second quarter
of 1995. Earnings per share were $1.39 on a fully diluted basis, a 3 percent
increase from $1.35 in the second quarter of last year. Net operating revenues
were $1.54 billion, an 8 percent advance over last year's second quarter $1.42
billion. Return on equity was 18.6 percent for the last twelve months.
Securities earnings climbed 40 percent to a record $135.4 million from
$96.9 million a year ago. It was Securities seventh consecutive quarter of
record earnings and an 11 percent increase from the first quarter of this year.
Securities net operating revenues of $858.9 million were also a quarterly
record. Credit Services earnings declined 26 percent to $103.4 million from
$140.6 million in last year's second quarter, largely as a result of increased
credit card write-offs.
-more-
<PAGE>
"We're pleased with the strong, across-the-board growth in revenues, but
we're not pleased that our earnings increased only slightly," said Philip J.
Purcell, Chairman and Chief Executive Officer. "Quite clearly, the industry-
wide trend of rising credit card write-offs cut into our overall earnings. But
we continued to benefit from our balance -- we had great earnings growth in our
Securities business.
"As credit card delinquencies and bankruptcies have increased nationwide
over the last six months, " Purcell said, "we have taken steps designed to
offset these increased costs. We have significantly increased our collection
efforts, imposed new over-limit and higher late fees, and are considering
further price increases later this year. To improve credit quality for the
longer term, we have raised credit quality standards for new accounts and have
selectively reduced credit limits. We believe the actions that we've taken,
while having some impact in the year's first half, should have an increasing
effect as the year goes on. "
Net income for the first six months of 1996 reached a record $484.6
million, a 5 percent increase from $459.6 million for the first half of 1995.
Earnings per share increased 6 percent to $2.79 from $2.63 for the first half of
1995. Six month net operating revenues increased 11 percent to $3.09 billion.
SECURITIES
Record quarterly revenues in Securities were the result of continuing
strong growth in almost every part of this business:
. Commission revenues increased by 23 percent over last year's second quarter
to $303.8 million on higher equity, mutual fund and insurance product sales.
. Asset management and administration fees increased 14 percent to $285.8
million. Assets under management and administration rose to a record $84.6
billion, up $11.3 billion or 15 percent over the end of last year's second
quarter and up $5.1 billion for the first six months of the year.
-more-
<PAGE>
. The number of account executives rose by almost 110 during the quarter, to
reach a record 8,823 - an increase of more than 750 over last year's second
quarter end.
. Total client assets rose by $5.7 billion during the second quarter to an
all-time high of $234.2 billion. The 327,000 new accounts opened year-to-
date represent the highest six month total in Dean Witter's history.
Securities return on equity was 39 percent for the trailing twelve months.
Securities net operating revenues for the quarter increased 13 percent over the
second quarter of last year to a record $858.9 million, while operating expenses
increased by only 6 percent to $633.9 million. The quarter's profit margin
increased to a record 15.8 percent.
Dean Witter Securities did exceptionally well in the fourth annual Wall
Street Journal Research Analyst Survey, with 24 analysts achieving all-star
status. Dean Witter ranked second among all securities firms.
CREDIT SERVICES
Expanding Credit Services revenues were also driven by strong across-the-board
business growth:
. Managed loans increased by $5.3 billion to $32.4 billion, up 20 percent over a
year ago.
. Merchant and cardmember fees were $419.5 million, on a managed loan basis, up
40 percent from last year's second quarter. The increase was due to higher
transaction volume and to first quarter pricing actions.
. General purpose credit card accounts reached 37.7 million at quarter end, up
4.2 million or 13 percent, over a year ago.
-more-
<PAGE>
. The NOVUS Network of merchant establishments, serving the Discover, Private
Issue and BRAVO Cards, enrolled more than 125,000 locations during the
quarter - and now has enrolled more than 200,000 during the first six months
of the year.
Net interest income of $716.1 million rose 18 percent over the second quarter
of 1995 driven by loan growth of 20 percent.
Net operating revenues increased 3 percent to $682.8 million from the second
quarter of 1995 despite an 89 percent increase in the provision for loan losses.
The increase in the provision was primarily the result of higher write-offs.
Operating expenses increased 18 percent from the second quarter of last year to
$519.7 million.
"We continued to do a good job in growing our Credit Services business in
terms of receivables, new accounts and merchant locations. It continued to be a
very profitable business," said Purcell. "Our immediate challenge is to deal
with write-offs and to make sure our annual profits continue to grow."
# # #
<PAGE>
DEAN WITTER, DISCOVER & CO.
Financial Summary
(in millions, except share data)
(unaudited)
Three Months %
Ended June 30, Increase
1996 1995 (Decrease)
----------- ----------- -----------
Total revenues
Credit Services $ 1,211.7 1,037.1 17%
Securities 983.9 909.8 8%
----------- -----------
Total Dean Witter, Discover & Co. $ 2,195.6 1,946.9 13%
=========== ===========
Net operating revenues (1)
Credit Services $ 682.8 665.0 3%
Securities 858.9 759.9 13%
----------- -----------
Total Dean Witter, Discover & Co. $ 1,541.7 1,424.9 8%
=========== ===========
Net income
Credit Services $ 103.4 140.6 (26%)
Securities 135.4 96.9 40%
----------- -----------
Total Dean Witter, Discover & Co. $ 238.8 237.5 1%
=========== ===========
Earnings per share:
Primary net income per share $ 1.39 1.35
Primary avg common shares o/s (2) 172,116,228 175,356,499
Fully diluted net income per share $ 1.39 1.35
Fully diluted avg common shares o/s (2) 172,145,135 175,524,180
Common shares o/s at period end 164,705,945 170,526,513
(1) Net operating revenues is total revenues minus interest expense and the
provision for losses on receivables.
(2) Primary dilution is based on average share price for the period. Fully
diluted is based on the higher of
average or ending share price for the period.
<PAGE>
DEAN WITTER, DISCOVER & CO.
Financial Summary
(in millions, except share data)
(unaudited)
Six Months %
Ended June 30, Increase
1996 1995 (Decrease)
----------- ----------- -----------
Total revenues
Credit Services $ 2,412.8 2,013.5 20%
Securities 1,949.0 1,774.6 10%
----------- -----------
Total Dean Witter, Discover & Co. $ 4,361.8 3,788.1 15%
=========== ===========
Net operating revenues (1)
Credit Services $ 1,383.8 1,298.2 7%
Securities 1,705.4 1,494.3 14%
----------- -----------
Total Dean Witter, Discover & Co. $ 3,089.2 2,792.5 11%
=========== ===========
Net income
Credit Services $ 227.7 272.6 (16%)
Securities 256.9 187.0 37%
----------- -----------
Total Dean Witter, Discover & Co. $ 484.6 459.6 5%
=========== ===========
Earnings per share:
Primary net income per share $ 2.80 2.63
Primary avg common shares o/s (2) 173,140,721 174,431,952
Fully diluted net income per share $ 2.79 2.63
Fully diluted avg common shares o/s (2) 173,470,900 174,952,312
Common shares o/s at period end 164,705,945 170,526,513
(1) Net operating revenues is total revenues minus interest expense and the
provision for losses on receivables.
(2) Primary dilution is based on average share price for the period. Fully
diluted is based on the higher of
average or ending share price for the period.
<PAGE>
DEAN WITTER, DISCOVER & CO.
Consolidated Income Data
(in millions, except share data)
(unaudited, Managed loan basis)
Three Months %
Ended June 30, Increase
1996 1995 (Decrease)
----------- ----------- -----------
Merchant and cardmember fees $ 419.5 298.8 40%
Commissions 303.8 247.9 23%
Asset management and admin. fees 285.8 251.0 14%
Servicing fees 0.0 0.0 --
Principal transactions 114.5 120.8 (5%)
Investment banking 57.6 48.7 18%
Other 33.5 26.1 28%
----------- -----------
Total non-interest revenues 1,214.7 993.3 22%
----------- -----------
Interest revenue 1,366.7 1,240.9 10%
Interest expense 582.8 566.9 3%
----------- -----------
Net interest income 783.9 674.0 16%
Provision for losses on receivables 456.9 242.4 88%
----------- -----------
Net credit income 327.0 431.6 (24%)
----------- -----------
Net operating revenues 1,541.7 1,424.9 8%
----------- -----------
Employee compensation and benefits 552.9 489.5 13%
Marketing and business development 201.4 159.0 27%
Info. processing and communications 185.9 171.7 8%
Facilities and equipment 63.7 58.4 9%
Other 149.7 161.0 (7%)
----------- -----------
Total non-interest expenses 1,153.6 1,039.6 11%
----------- -----------
Income before income taxes 388.1 385.3 1%
Income tax expense 149.3 147.8 1%
----------- -----------
Net income $ 238.8 237.5 1%
=========== ===========
Primary net income per share $ 1.39 1.35
Primary avg common shares o/s 172,116,228 175,356,499
Fully diluted net income per share $ 1.39 1.35
Fully diluted avg common shares o/s 172,145,135 175,524,180
Oper exp as a % of net oper revenues 74.8% 73.0%
Effective tax rate 38.5% 38.4%
<PAGE>
DEAN WITTER, DISCOVER & CO.
Consolidated Income Data
(in millions, except share data)
(unaudited, Managed loan basis)
Six Months %
Ended June 30, Increase
1996 1995 (Decrease)
----------- ----------- -----------
Merchant and cardmember fees $ 787.0 570.4 38%
Commissions 604.5 482.5 25%
Asset management and admin. fees 560.7 496.5 13%
Servicing fees 0.0 0.0 --
Principal transactions 233.4 246.2 (5%)
Investment banking 122.3 87.6 40%
Other 58.3 53.1 10%
----------- -----------
Total non-interest revenues 2,366.2 1,936.3 22%
----------- -----------
Interest revenue 2,721.3 2,396.2 14%
Interest expense 1,162.4 1,088.8 7%
----------- -----------
Net interest income 1,558.9 1,307.4 19%
Provision for losses on receivables 835.9 451.2 85%
----------- -----------
Net credit income 723.0 856.2 (16%)
----------- -----------
Net operating revenues 3,089.2 2,792.5 11%
----------- -----------
Employee compensation and benefits 1,123.2 973.2 15%
Marketing and business development 393.3 306.7 28%
Info. processing and communications 368.0 326.1 13%
Facilities and equipment 124.9 112.8 11%
Other 291.3 326.1 (11%)
----------- -----------
Total non-interest expenses 2,300.7 2,044.9 13%
----------- -----------
Income before income taxes 788.5 747.6 5%
Income tax expense 303.9 288.0 6%
----------- -----------
Net income $ 484.6 459.6 5%
=========== ===========
Primary net income per share $ 2.80 2.63
Primary avg common shares o/s 173,140,721 174,431,952
Fully diluted net income per share $ 2.79 2.63
Fully diluted avg common shares o/s 173,470,900 174,952,312
Oper exp as a % of net oper revenues 74.5% 73.2%
Effective tax rate 38.5% 38.5%
<PAGE>
DEAN WITTER, DISCOVER & CO.
Credit Services Summarized Income Data
(in millions)
(unaudited, Managed loan basis)
Three Months %
Ended June 30, Increase
1996 1995 (Decrease)
----------- ----------- -----------
Merchant and cardmember fees $ 419.5 298.8 40%
Servicing fees 0.0 0.0 --
Other 1.2 0.4 *
----------- -----------
Total non-interest revenues 420.7 299.2 41%
----------- -----------
Interest revenue 1,176.8 1,025.2 15%
Interest expense 460.7 418.9 10%
----------- -----------
Net interest income 716.1 606.3 18%
Provision for loan losses 454.0 240.5 89%
----------- -----------
Net credit income 262.1 365.8 (28%)
----------- -----------
Net operating revenues 682.8 665.0 3%
----------- -----------
Employee compensation and benefits 119.3 104.8 14%
Marketing and business development 174.0 132.0 32%
Info. processing and communications 116.9 105.4 11%
Facilities and equipment 15.4 12.1 27%
Other 94.1 85.4 10%
----------- -----------
Total non-interest expenses 519.7 439.7 18%
----------- -----------
Income before income taxes 163.1 225.3 (28%)
Income tax expense 59.7 84.7 (30%)
----------- -----------
Net income $ 103.4 140.6 (26%)
=========== ===========
Oper exp as a % of net oper revenues 76.1% 66.1%
Profit margin (1) 15.1% 21.1%
Effective tax rate 36.6% 37.6%
(1) Profit margin is defined as net income as a percentage
of net operating revenues.
<PAGE>
DEAN WITTER, DISCOVER & CO.
Credit Services Summarized Income Data
(in millions)
(unaudited, Managed loan basis)
Six Months %
Ended June 30, Increase
1996 1995 (Decrease)
----------- ----------- -----------
Merchant and cardmember fees $ 787.0 570.4 38%
Servicing fees 0.0 0.0 --
Other 6.3 0.7 *
----------- -----------
Total non-interest revenues 793.3 571.1 39%
----------- -----------
Interest revenue 2,345.2 1,986.8 18%
Interest expense 924.7 813.6 14%
----------- -----------
Net interest income 1,420.5 1,173.2 21%
Provision for loan losses 830.0 446.1 86%
----------- -----------
Net credit income 590.5 727.1 (19%)
----------- -----------
Net operating revenues 1,383.8 1,298.2 7%
----------- -----------
Employee compensation and benefits 243.5 207.1 18%
Marketing and business development 338.4 256.5 32%
Info. processing and communications 231.3 196.3 18%
Facilities and equipment 30.2 23.9 26%
Other 179.9 176.5 2%
----------- -----------
Total non-interest expenses 1,023.3 860.3 19%
----------- -----------
Income before income taxes 360.5 437.9 (18%)
Income tax expense 132.8 165.3 (20%)
----------- -----------
Net income $ 227.7 272.6 (16%)
=========== ===========
Oper exp as a % of net oper revenues 73.9% 66.3%
Profit margin (1) 16.5% 21.0%
Effective tax rate 36.8% 37.7%
(1) Profit margin is defined as net income as a percentage
of net operating revenues.
<PAGE>
DEAN WITTER, DISCOVER & CO.
Securities Summarized Income Data
(in millions)
(unaudited, GAAP and Managed loan basis)
Three Months %
Ended June 30, Increase
1996 1995 (Decrease)
----------- ----------- -----------
Commissions $ 303.8 247.9 23%
Asset management and admin. fees 285.8 251.0 14%
Principal transactions 114.5 120.8 (5%)
Investment banking 57.6 48.7 18%
Other 32.3 25.7 26%
----------- -----------
Total non-interest revenues 794.0 694.1 14%
----------- -----------
Interest revenue 189.9 215.7 (12%)
Interest expense 122.1 148.0 (18%)
----------- -----------
Net interest income 67.8 67.7 --
Provision for losses on receivables 2.9 1.9 53%
----------- -----------
Net credit income 64.9 65.8 (1%)
----------- -----------
Net operating revenues 858.9 759.9 13%
----------- -----------
Employee compensation and benefits 433.6 384.7 13%
Marketing and business development 27.4 27.0 1%
Info. processing and communications 69.0 66.3 4%
Facilities and equipment 48.3 46.3 4%
Other 55.6 75.6 (26%)
----------- -----------
Total non-interest expenses 633.9 599.9 6%
----------- -----------
Income before income taxes 225.0 160.0 41%
Income tax expense 89.6 63.1 42%
----------- -----------
Net income $ 135.4 96.9 40%
=========== ===========
Oper exp as a % of net oper revenues 73.8% 78.9%
Profit margin (1) 15.8% 12.8%
Effective tax rate 39.8% 39.4%
(1) Profit margin is defined as net income as a percentage
of net operating revenues.
<PAGE>
DEAN WITTER, DISCOVER & CO.
Securities Summarized Income Data
(in millions)
(unaudited, GAAP and Managed loan basis)
Six Months %
Ended June 30, Increase
1996 1995 (Decrease)
----------- ----------- -----------
Commissions $ 604.5 482.5 25%
Asset management and admin. fees 560.7 496.5 13%
Principal transactions 233.4 246.2 (5%)
Investment banking 122.3 87.6 40%
Other 52.0 52.4 (1%)
----------- -----------
Total non-interest revenues 1,572.9 1,365.2 15%
----------- -----------
Interest revenue 376.1 409.4 (8%)
Interest expense 237.7 275.2 (14%)
----------- -----------
Net interest income 138.4 134.2 3%
Provision for losses on receivables 5.9 5.1 16%
----------- -----------
Net credit income 132.5 129.1 3%
----------- -----------
Net operating revenues 1,705.4 1,494.3 14%
----------- -----------
Employee compensation and benefits 879.7 766.1 15%
Marketing and business development 54.9 50.2 9%
Info. processing and communications 136.7 129.8 5%
Facilities and equipment 94.7 88.9 7%
Other 111.4 149.6 (26%)
----------- -----------
Total non-interest expenses 1,277.4 1,184.6 8%
----------- -----------
Income before income taxes 428.0 309.7 38%
Income tax expense 171.1 122.7 39%
----------- -----------
Net income $ 256.9 187.0 37%
=========== ===========
Oper exp as a % of net oper revenues 74.9% 79.3%
Profit margin (1) 15.1% 12.5%
Effective tax rate 40.0% 39.6%
(1) Profit margin is defined as net income as a percentage
of net operating revenues.
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Consolidated Income Data
(in millions)
(unaudited, Managed loan basis)
FOR THE QUARTER ENDED
6/30/96 3/31/96 12/31/95
----------- ----------- -----------
Merchant and cardmember fees $ 419.5 367.5 379.7
Commissions 303.8 300.7 273.8
Asset management and admin. fees 285.8 274.9 258.6
Servicing fees 0.0 0.0 0.0
Principal transactions 114.5 118.9 111.1
Investment banking 57.6 64.7 48.8
Other 33.5 24.8 24.1
----------- ----------- -----------
Total non-interest revenues 1,214.7 1,151.5 1,096.1
----------- ----------- -----------
Interest revenue 1,366.7 1,354.6 1,337.9
Interest expense 582.8 579.6 580.5
----------- ----------- -----------
Net interest income 783.9 775.0 757.4
Provision for losses on receivables 456.9 379.0 421.3
----------- ----------- -----------
Net credit income 327.0 396.0 336.1
----------- ----------- -----------
Net operating revenues 1,541.7 1,547.5 1,432.2
----------- ----------- -----------
Employee compensation and benefits 552.9 570.3 496.9
Marketing and business development 201.4 191.9 224.0
Info. processing and communications 185.9 182.1 191.5
Facilities and equipment 63.7 61.2 61.9
Other 149.7 141.6 165.3
----------- ----------- -----------
Total non-interest expenses 1,153.6 1,147.1 1,139.6
----------- ----------- -----------
Income before income taxes 388.1 400.4 292.6
Income tax expense 149.3 154.6 114.5
----------- ----------- -----------
Net income $ 238.8 245.8 178.1
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Consolidated Income Data
(in millions)
(unaudited, Managed loan basis)
FOR THE QUARTER ENDED
9/30/95 6/30/95 3/31/95
----------- ----------- -----------
Merchant and cardmember fees $ 322.5 298.8 271.6
Commissions 266.2 247.9 234.6
Asset management and admin. fees 251.7 251.0 245.5
Servicing fees 0.0 0.0 0.0
Principal transactions 121.6 120.8 125.4
Investment banking 45.1 48.7 38.9
Other 16.3 26.1 27.0
----------- ----------- -----------
Total non-interest revenues 1,023.4 993.3 943.0
----------- ----------- -----------
Interest revenue 1,280.1 1,240.9 1,155.3
Interest expense 554.1 566.9 521.9
----------- ----------- -----------
Net interest income 726.0 674.0 633.4
Provision for losses on receivables 298.2 242.4 208.8
----------- ----------- -----------
Net credit income 427.8 431.6 424.6
----------- ----------- -----------
Net operating revenues 1,451.2 1,424.9 1,367.6
----------- ----------- -----------
Employee compensation and benefits 511.5 489.5 483.7
Marketing and business development 204.4 159.0 147.7
Info. processing and communications 169.9 171.7 154.4
Facilities and equipment 60.8 58.4 54.4
Other 148.9 161.0 165.1
----------- ----------- -----------
Total non-interest expenses 1,095.5 1,039.6 1,005.3
----------- ----------- -----------
Income before income taxes 355.7 385.3 362.3
Income tax expense 137.0 147.8 140.2
----------- ----------- -----------
Net income $ 218.7 237.5 222.1
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Consolidated Income Data
(in millions)
(unaudited, Managed loan basis)
FOR THE QUARTER ENDED
12/31/94 9/30/94 6/30/94
----------- ----------- -----------
Merchant and cardmember fees $ 300.3 264.7 242.7
Commissions 211.6 208.2 206.9
Asset management and admin. fees 245.3 243.9 243.5
Servicing fees 0.0 0.0 0.0
Principal transactions 121.6 105.8 102.1
Investment banking 41.1 32.5 40.3
Other 30.8 12.5 36.4
----------- ----------- -----------
Total non-interest revenues 950.7 867.6 871.9
----------- ----------- -----------
Interest revenue 1,095.7 980.7 925.7
Interest expense 484.2 397.5 381.0
----------- ----------- -----------
Net interest income 611.5 583.2 544.7
Provision for losses on receivables 304.0 210.1 179.9
----------- ----------- -----------
Net credit income 307.5 373.1 364.8
----------- ----------- -----------
Net operating revenues 1,258.2 1,240.7 1,236.7
----------- ----------- -----------
Employee compensation and benefits 428.1 432.7 432.5
Marketing and business development 201.7 167.5 120.4
Info. processing and communications 164.4 146.2 147.8
Facilities and equipment 57.7 58.1 57.4
Other 173.8 136.0 140.5
----------- ----------- -----------
Total non-interest expenses 1,025.7 940.5 898.6
----------- ----------- -----------
Income before income taxes 232.5 300.2 338.1
Income tax expense 92.5 115.7 131.2
----------- ----------- -----------
Net income $ 140.0 184.5 206.9
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Credit Services Income Data
(in millions)
(unaudited, Managed loan basis)
FOR THE QUARTER ENDED
6/30/96 3/31/96 12/31/95
----------- ----------- -----------
Merchant and cardmember fees $ 419.5 367.5 379.7
Servicing fees 0.0 0.0 0.0
Other 1.2 5.1 1.0
----------- ----------- -----------
Total non-interest revenues 420.7 372.6 380.7
----------- ----------- -----------
Interest revenue 1,176.8 1,168.4 1,131.5
Interest expense 460.7 464.0 453.7
----------- ----------- -----------
Net interest income 716.1 704.4 677.8
Provision for loan losses 454.0 376.0 415.6
----------- ----------- -----------
Net credit income 262.1 328.4 262.2
----------- ----------- -----------
Net operating revenues 682.8 701.0 642.9
----------- ----------- -----------
Employee compensation and benefits 119.3 124.2 119.2
Marketing and business development 174.0 164.4 201.2
Info. processing and communications 116.9 114.4 115.5
Facilities and equipment 15.4 14.8 13.7
Other 94.1 85.8 89.2
----------- ----------- -----------
Total non-interest expenses 519.7 503.6 538.8
----------- ----------- -----------
Income before income taxes 163.1 197.4 104.1
Income tax expense 59.7 73.1 41.8
----------- ----------- -----------
Net income $ 103.4 124.3 62.3
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Credit Services Income Data
(in millions)
(unaudited, Managed loan basis)
FOR THE QUARTER ENDED
9/30/95 6/30/95 3/31/95
----------- ----------- -----------
Merchant and cardmember fees $ 322.5 298.8 271.6
Servicing fees 0.0 0.0 0.0
Other 0.9 0.4 0.3
----------- ----------- -----------
Total non-interest revenues 323.4 299.2 271.9
----------- ----------- -----------
Interest revenue 1,075.8 1,025.2 961.6
Interest expense 426.8 418.9 394.7
----------- ----------- -----------
Net interest income 649.0 606.3 566.9
Provision for loan losses 295.8 240.5 205.6
----------- ----------- -----------
Net credit income 353.2 365.8 361.3
----------- ----------- -----------
Net operating revenues 676.6 665.0 633.2
----------- ----------- -----------
Employee compensation and benefits 112.3 104.8 102.3
Marketing and business development 187.6 132.0 124.5
Info. processing and communications 107.2 105.4 90.9
Facilities and equipment 13.5 12.1 11.8
Other 77.1 85.4 91.1
----------- ----------- -----------
Total non-interest expenses 497.7 439.7 420.6
----------- ----------- -----------
Income before income taxes 178.9 225.3 212.6
Income tax expense 66.9 84.7 80.6
----------- ----------- -----------
Net income $ 112.0 140.6 132.0
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Credit Services Income Data
(in millions)
(unaudited, Managed loan basis)
FOR THE QUARTER ENDED
12/31/94 9/30/94 6/30/94
----------- ----------- -----------
Merchant and cardmember fees $ 300.3 264.7 242.7
Servicing fees 0.0 0.0 0.0
Other 0.3 0.2 0.2
----------- ----------- -----------
Total non-interest revenues 300.6 264.9 242.9
----------- ----------- -----------
Interest revenue 912.0 842.2 793.5
Interest expense 362.2 312.7 297.3
----------- ----------- -----------
Net interest income 549.8 529.5 496.2
Provision for loan losses 300.7 207.9 177.6
----------- ----------- -----------
Net credit income 249.1 321.6 318.6
----------- ----------- -----------
Net operating revenues 549.7 586.5 561.5
----------- ----------- -----------
Employee compensation and benefits 97.2 95.4 91.9
Marketing and business development 177.7 146.8 96.8
Info. processing and communications 95.7 85.4 81.9
Facilities and equipment 11.5 11.3 13.8
Other 83.3 71.6 67.8
----------- ----------- -----------
Total non-interest expenses 465.4 410.5 352.2
----------- ----------- -----------
Income before income taxes 84.3 176.0 209.3
Income tax expense 32.4 66.4 80.1
----------- ----------- -----------
Net income $ 51.9 109.6 129.2
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Securities Income Data
(in millions)
(unaudited, GAAP and Managed loan basis)
FOR THE QUARTER ENDED
6/30/96 3/31/96 12/31/95
----------- ----------- -----------
Commissions $ 303.8 300.7 273.8
Asset management and admin. fees 285.8 274.9 258.6
Principal transactions 114.5 118.9 111.1
Investment banking 57.6 64.7 48.8
Other 32.3 19.7 23.1
----------- ----------- -----------
Total non-interest revenues 794.0 778.9 715.4
----------- ----------- -----------
Interest revenue 189.9 186.2 206.4
Interest expense 122.1 115.6 126.9
----------- ----------- -----------
Net interest income 67.8 70.6 79.5
Provision for losses on receivables 2.9 3.0 5.6
----------- ----------- -----------
Net credit income 64.9 67.6 73.9
----------- ----------- -----------
Net operating revenues 858.9 846.5 789.3
----------- ----------- -----------
Employee compensation and benefits 433.6 446.1 377.7
Marketing and business development 27.4 27.5 22.8
Info. processing and communications 69.0 67.7 76.0
Facilities and equipment 48.3 46.4 48.2
Other 55.6 55.8 76.1
----------- ----------- -----------
Total non-interest expenses 633.9 643.5 600.8
----------- ----------- -----------
Income before income taxes 225.0 203.0 188.5
Income tax expense 89.6 81.5 72.7
----------- ----------- -----------
Net income $ 135.4 121.5 115.8
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Securities Income Data
(in millions)
(unaudited, GAAP and Managed loan basis)
FOR THE QUARTER ENDED
9/30/95 6/30/95 3/31/95
----------- ----------- -----------
Commissions $ 266.2 247.9 234.6
Asset management and admin. fees 251.7 251.0 245.5
Principal transactions 121.6 120.8 125.4
Investment banking 45.1 48.7 38.9
Other 15.4 25.7 26.7
----------- ----------- -----------
Total non-interest revenues 700.0 694.1 671.1
----------- ----------- -----------
Interest revenue 204.3 215.7 193.7
Interest expense 127.2 148.0 127.2
----------- ----------- -----------
Net interest income 77.1 67.7 66.5
Provision for losses on receivables 2.5 1.9 3.2
----------- ----------- -----------
Net credit income 74.6 65.8 63.3
----------- ----------- -----------
Net operating revenues 774.6 759.9 734.4
----------- ----------- -----------
Employee compensation and benefits 399.2 384.7 381.4
Marketing and business development 16.8 27.0 23.2
Info. processing and communications 62.7 66.3 63.5
Facilities and equipment 47.3 46.3 42.6
Other 71.8 75.6 74.0
----------- ----------- -----------
Total non-interest expenses 597.8 599.9 584.7
----------- ----------- -----------
Income before income taxes 176.8 160.0 149.7
Income tax expense 70.1 63.1 59.6
----------- ----------- -----------
Net income $ 106.7 96.9 90.1
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Securities Income Data
(in millions)
(unaudited, GAAP and Managed loan basis)
FOR THE QUARTER ENDED
12/31/94 9/30/94 6/30/94
----------- ----------- -----------
Commissions $ 211.6 208.2 206.9
Asset management and admin. fees 245.3 243.9 243.5
Principal transactions 121.6 105.8 102.1
Investment banking 41.1 32.5 40.3
Other 30.5 12.3 36.2
----------- ----------- -----------
Total non-interest revenues 650.1 602.7 629.0
----------- ----------- -----------
Interest revenue 183.7 138.5 132.2
Interest expense 122.0 84.8 83.7
----------- ----------- -----------
Net interest income 61.7 53.7 48.5
Provision for losses on receivables 3.3 2.2 2.3
----------- ----------- -----------
Net credit income 58.4 51.5 46.2
----------- ----------- -----------
Net operating revenues 708.5 654.2 675.2
----------- ----------- -----------
Employee compensation and benefits 330.9 337.3 340.6
Marketing and business development 24.0 20.7 23.6
Info. processing and communications 68.7 60.8 65.9
Facilities and equipment 46.2 46.8 43.6
Other 90.5 64.4 72.7
----------- ----------- -----------
Total non-interest expenses 560.3 530.0 546.4
----------- ----------- -----------
Income before income taxes 148.2 124.2 128.8
Income tax expense 60.1 49.3 51.1
----------- ----------- -----------
Net income $ 88.1 74.9 77.7
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Consolidated Income Data
(in millions, except share data)
(unaudited, GAAP basis)
Three Months %
Ended June 30, Increase
1996 1995 (Decrease)
----------- ----------- -----------
Merchant and cardmember fees $ 345.6 265.6 30%
Commissions 303.8 247.9 23%
Asset management and admin. fees 285.8 251.0 14%
Servicing fees 191.5 174.2 10%
Principal transactions 114.5 120.8 (5%)
Investment banking 57.6 48.7 18%
Other 33.5 26.1 28%
----------- -----------
Total non-interest revenues 1,332.3 1,134.3 17%
----------- -----------
Interest revenue 863.3 812.6 6%
Interest expense 379.7 384.4 (1%)
----------- -----------
Net interest income 483.6 428.2 13%
Provision for losses on receivables 274.2 137.6 99%
----------- -----------
Net credit income 209.4 290.6 (28%)
----------- -----------
Net operating revenues 1,541.7 1,424.9 8%
----------- -----------
Employee compensation and benefits 552.9 489.5 13%
Marketing and business development 201.4 159.0 27%
Info. processing and communications 185.9 171.7 8%
Facilities and equipment 63.7 58.4 9%
Other 149.7 161.0 (7%)
----------- -----------
Total non-interest expenses 1,153.6 1,039.6 11%
----------- -----------
Income before income taxes 388.1 385.3 1%
Income tax expense 149.3 147.8 1%
----------- -----------
Net income $ 238.8 237.5 1%
=========== ===========
Primary net income per share $ 1.39 1.35
Primary avg common shares o/s 172,116,228 175,356,499
Fully diluted net income per share $ 1.39 1.35
Fully diluted avg common shares o/s 172,145,135 175,524,180
Oper exp as a % of net oper revenues 74.8% 73.0%
Effective tax rate 38.5% 38.4%
<PAGE>
DEAN WITTER, DISCOVER & CO.
Consolidated Income Data
(in millions, except share data)
(unaudited, GAAP basis)
Six Months %
Ended June 30, Increase
1996 1995 (Decrease)
----------- ----------- -----------
Merchant and cardmember fees $ 666.1 505.9 32%
Commissions 604.5 482.5 25%
Asset management and admin. fees 560.7 496.5 13%
Servicing fees 391.8 346.5 13%
Principal transactions 233.4 246.2 (5%)
Investment banking 122.3 87.6 40%
Other 58.3 53.1 10%
----------- -----------
Total non-interest revenues 2,637.1 2,218.3 19%
----------- -----------
Interest revenue 1,724.7 1,569.8 10%
Interest expense 770.4 737.3 4%
----------- -----------
Net interest income 954.3 832.5 15%
Provision for losses on receivables 502.2 258.3 94%
----------- -----------
Net credit income 452.1 574.2 (21%)
----------- -----------
Net operating revenues 3,089.2 2,792.5 11%
----------- -----------
Employee compensation and benefits 1,123.2 973.2 15%
Marketing and business development 393.3 306.7 28%
Info. processing and communications 368.0 326.1 13%
Facilities and equipment 124.9 112.8 11%
Other 291.3 326.1 (11%)
----------- -----------
Total non-interest expenses 2,300.7 2,044.9 13%
----------- -----------
Income before income taxes 788.5 747.6 5%
Income tax expense 303.9 288.0 6%
----------- -----------
Net income $ 484.6 459.6 5%
=========== ===========
Primary net income per share $ 2.80 2.63
Primary avg common shares o/s 173,140,721 174,431,952
Fully diluted net income per share $ 2.79 2.63
Fully diluted avg common shares o/s 173,470,900 174,952,312
Oper exp as a % of net oper revenues 74.5% 73.2%
Effective tax rate 38.5% 38.5%
<PAGE>
DEAN WITTER, DISCOVER & CO.
Credit Services Summarized Income Data
(in millions)
(unaudited, GAAP basis)
Three Months %
Ended June 30, Increase
1996 1995 (Decrease)
----------- ----------- -----------
Merchant and cardmember fees (1) $ 345.6 265.6 30%
Servicing fees (1) 191.5 174.2 10%
Other 1.2 0.4 *
----------- -----------
Total non-interest revenues 538.3 440.2 22%
----------- -----------
Interest revenue (1) 673.4 596.9 13%
Interest expense (1) 257.6 236.4 9%
----------- -----------
Net interest income 415.8 360.5 15%
Provision for loan losses (1) 271.3 135.7 100%
----------- -----------
Net credit income 144.5 224.8 (36%)
----------- -----------
Net operating revenues 682.8 665.0 3%
----------- -----------
Employee compensation and benefits 119.3 104.8 14%
Marketing and business development 174.0 132.0 32%
Info. processing and communications 116.9 105.4 11%
Facilities and equipment 15.4 12.1 27%
Other 94.1 85.4 10%
----------- -----------
Total non-interest expenses 519.7 439.7 18%
----------- -----------
Income before income taxes 163.1 225.3 (28%)
Income tax expense 59.7 84.7 (30%)
----------- -----------
Net income $ 103.4 140.6 (26%)
=========== ===========
Oper exp as a % of net oper revenues 76.1% 66.1%
Profit margin (2) 15.1% 21.1%
Effective tax rate 36.6% 37.6%
(1) Period-to-period comparisons for these line items are significantly
affected by the relative levels of securitized assets.
For comparative information on a managed loan basis, see Credit Services
Summarized Income Data (unaudited, Managed loan basis) above.
(2) Profit margin is defined as net income as a percentage of net operating
revenues.
<PAGE>
DEAN WITTER, DISCOVER & CO.
Credit Services Summarized Income Data
(in millions)
(unaudited, GAAP basis)
Six Months %
Ended June 30, Increase
1996 1995 (Decrease)
----------- ----------- -----------
Merchant and cardmember fees (1) $ 666.1 505.9 32%
Servicing fees (1) 391.8 346.5 13%
Other 6.3 0.7 *
----------- -----------
Total non-interest revenues 1,064.2 853.1 25%
----------- -----------
Interest revenue (1) 1,348.6 1,160.4 16%
Interest expense (1) 532.7 462.1 15%
----------- -----------
Net interest income 815.9 698.3 17%
Provision for loan losses (1) 496.3 253.2 96%
----------- -----------
Net credit income 319.6 445.1 (28%)
----------- -----------
Net operating revenues 1,383.8 1,298.2 7%
----------- -----------
Employee compensation and benefits 243.5 207.1 18%
Marketing and business development 338.4 256.5 32%
Info. processing and communications 231.3 196.3 18%
Facilities and equipment 30.2 23.9 26%
Other 179.9 176.5 2%
----------- -----------
Total non-interest expenses 1,023.3 860.3 19%
----------- -----------
Income before income taxes 360.5 437.9 (18%)
Income tax expense 132.8 165.3 (20%)
----------- -----------
Net income $ 227.7 272.6 (16%)
=========== ===========
Oper exp as a % of net oper revenues 73.9% 66.3%
Profit margin (2) 16.5% 21.0%
Effective tax rate 36.8% 37.7%
(1) Period-to-period comparisons for these line items are significantly
affected by the relative levels of securitized assets.
For comparative information on a managed loan basis, see Credit Services
Summarized Income Data (unaudited, Managed loan basis) above.
(2) Profit margin is defined as net income as a percentage
of net operating revenues.
<PAGE>
DEAN WITTER, DISCOVER & CO.
Securities Summarized Income Data
(in millions)
(unaudited, GAAP and Managed loan basis)
Three Months %
Ended June 30, Increase
1996 1995 (Decrease)
----------- ----------- -----------
Commissions $ 303.8 247.9 23%
Asset management and admin. fees 285.8 251.0 14%
Principal transactions 114.5 120.8 (5%)
Investment banking 57.6 48.7 18%
Other 32.3 25.7 26%
----------- -----------
Total non-interest revenues 794.0 694.1 14%
----------- -----------
Interest revenue 189.9 215.7 (12%)
Interest expense 122.1 148.0 (18%)
----------- -----------
Net interest income 67.8 67.7 --
Provision for losses on receivables 2.9 1.9 53%
----------- -----------
Net credit income 64.9 65.8 (1%)
----------- -----------
Net operating revenues 858.9 759.9 13%
----------- -----------
Employee compensation and benefits 433.6 384.7 13%
Marketing and business development 27.4 27.0 1%
Info. processing and communications 69.0 66.3 4%
Facilities and equipment 48.3 46.3 4%
Other 55.6 75.6 (26%)
----------- -----------
Total non-interest expenses 633.9 599.9 6%
----------- -----------
Income before income taxes 225.0 160.0 41%
Income tax expense 89.6 63.1 42%
----------- -----------
Net income $ 135.4 96.9 40%
=========== ===========
Oper exp as a % of net oper revenues 73.8% 78.9%
Profit margin (1) 15.8% 12.8%
Effective tax rate 39.8% 39.4%
(1) Profit margin is defined as net income as a percentage
of net operating revenues.
<PAGE>
DEAN WITTER, DISCOVER & CO.
Securities Summarized Income Data
(in millions)
(unaudited, GAAP and Managed loan basis)
Six Months %
Ended June 30, Increase
1996 1995 (Decrease)
----------- ----------- -----------
Commissions $ 604.5 482.5 25%
Asset management and admin. fees 560.7 496.5 13%
Principal transactions 233.4 246.2 (5%)
Investment banking 122.3 87.6 40%
Other 52.0 52.4 (1%)
----------- -----------
Total non-interest revenues 1,572.9 1,365.2 15%
----------- -----------
Interest revenue 376.1 409.4 (8%)
Interest expense 237.7 275.2 (14%)
----------- -----------
Net interest income 138.4 134.2 3%
Provision for losses on receivables 5.9 5.1 16%
----------- -----------
Net credit income 132.5 129.1 3%
----------- -----------
Net operating revenues 1,705.4 1,494.3 14%
----------- -----------
Employee compensation and benefits 879.7 766.1 15%
Marketing and business development 54.9 50.2 9%
Info. processing and communications 136.7 129.8 5%
Facilities and equipment 94.7 88.9 7%
Other 111.4 149.6 (26%)
----------- -----------
Total non-interest expenses 1,277.4 1,184.6 8%
----------- -----------
Income before income taxes 428.0 309.7 38%
Income tax expense 171.1 122.7 39%
----------- -----------
Net income $ 256.9 187.0 37%
=========== ===========
Oper exp as a % of net oper revenues 74.9% 79.3%
Profit margin (1) 15.1% 12.5%
Effective tax rate 40.0% 39.6%
(1) Profit margin is defined as net income as a percentage
of net operating revenues.
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Consolidated Income Data
(in millions)
(unaudited, GAAP basis)
FOR THE QUARTER ENDED
6/30/96 3/31/96 12/31/95
----------- ----------- -----------
Merchant and cardmember fees $ 345.6 320.5 343.6
Commissions 303.8 300.7 273.8
Asset management and admin. fees 285.8 274.9 258.6
Servicing fees 191.5 200.3 162.6
Principal transactions 114.5 118.9 111.1
Investment banking 57.6 64.7 48.8
Other 33.5 24.8 24.2
----------- ----------- -----------
Total non-interest revenues 1,332.3 1,304.8 1,222.7
----------- ----------- -----------
Interest revenue 863.3 861.4 905.0
Interest expense 379.7 390.7 402.8
----------- ----------- -----------
Net interest income 483.6 470.7 502.2
Provision for losses on receivables 274.2 228.0 292.7
----------- ----------- -----------
Net credit income 209.4 242.7 209.5
----------- ----------- -----------
Net operating revenues 1,541.7 1,547.5 1,432.2
----------- ----------- -----------
Employee compensation and benefits 552.9 570.3 496.9
Marketing and business development 201.4 191.9 224.0
Info. processing and communications 185.9 182.1 191.5
Facilities and equipment 63.7 61.2 61.9
Other 149.7 141.6 165.3
----------- ----------- -----------
Total non-interest expenses 1,153.6 1,147.1 1,139.6
----------- ----------- -----------
Income before income taxes 388.1 400.4 292.6
Income tax expense 149.3 154.6 114.5
----------- ----------- -----------
Net income $ 238.8 245.8 178.1
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Consolidated Income Data
(in millions)
(unaudited, GAAP basis)
FOR THE QUARTER ENDED
9/30/95 6/30/95 3/31/95
----------- ----------- -----------
Merchant and cardmember fees $ 285.8 265.6 240.3
Commissions 266.2 247.9 234.6
Asset management and admin. fees 251.7 251.0 245.5
Servicing fees 187.8 174.2 172.3
Principal transactions 121.6 120.8 125.4
Investment banking 45.1 48.7 38.9
Other 16.2 26.1 27.0
----------- ----------- -----------
Total non-interest revenues 1,174.4 1,134.3 1,084.0
----------- ----------- -----------
Interest revenue 844.2 812.6 757.2
Interest expense 374.7 384.4 352.9
----------- ----------- -----------
Net interest income 469.5 428.2 404.3
Provision for losses on receivables 192.7 137.6 120.7
----------- ----------- -----------
Net credit income 276.8 290.6 283.6
----------- ----------- -----------
Net operating revenues 1,451.2 1,424.9 1,367.6
----------- ----------- -----------
Employee compensation and benefits 511.5 489.5 483.7
Marketing and business development 204.4 159.0 147.7
Info. processing and communications 169.9 171.7 154.4
Facilities and equipment 60.8 58.4 54.4
Other 148.9 161.0 165.1
----------- ----------- -----------
Total non-interest expenses 1,095.5 1,039.6 1,005.3
----------- ----------- -----------
Income before income taxes 355.7 385.3 362.3
Income tax expense 137.0 147.8 140.2
----------- ----------- -----------
Net income $ 218.7 237.5 222.1
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Consolidated Income Data
(in millions)
(unaudited, GAAP basis)
FOR THE QUARTER ENDED
12/31/94 9/30/94 6/30/94
----------- ----------- -----------
Merchant and cardmember fees $ 268.9 238.6 216.1
Commissions 211.6 208.2 206.9
Asset management and admin. fees 245.3 243.9 243.5
Servicing fees 162.3 145.9 131.7
Principal transactions 121.6 105.8 102.1
Investment banking 41.1 32.5 40.3
Other 30.7 12.7 36.3
----------- ----------- -----------
Total non-interest revenues 1,081.5 987.6 976.9
----------- ----------- -----------
Interest revenue 706.3 653.8 604.2
Interest expense 319.8 263.6 246.3
----------- ----------- -----------
Net interest income 386.5 390.2 357.9
Provision for losses on receivables 209.8 137.1 98.1
----------- ----------- -----------
Net credit income 176.7 253.1 259.8
----------- ----------- -----------
Net operating revenues 1,258.2 1,240.7 1,236.7
----------- ----------- -----------
Employee compensation and benefits 428.1 432.7 432.5
Marketing and business development 201.7 167.5 120.4
Info. processing and communications 164.4 146.2 147.8
Facilities and equipment 57.7 58.1 57.4
Other 173.8 136.0 140.5
----------- ----------- -----------
Total non-interest expenses 1,025.7 940.5 898.6
----------- ----------- -----------
Income before income taxes 232.5 300.2 338.1
Income tax expense 92.5 115.7 131.2
----------- ----------- -----------
Net income $ 140.0 184.5 206.9
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Credit Services Income Data
(in millions)
(unaudited, GAAP basis)
FOR THE QUARTER ENDED
6/30/96 3/31/96 12/31/95
----------- ----------- -----------
Merchant and cardmember fees $ 345.6 320.5 343.6
Servicing fees 191.5 200.3 162.6
Other 1.2 5.1 1.1
----------- ----------- -----------
Total non-interest revenues 538.3 525.9 507.3
----------- ----------- -----------
Interest revenue 673.4 675.2 698.6
Interest expense 257.6 275.1 275.9
----------- ----------- -----------
Net interest income 415.8 400.1 422.7
Provision for loan losses 271.3 225.0 287.1
----------- ----------- -----------
Net credit income 144.5 175.1 135.6
----------- ----------- -----------
Net operating revenues 682.8 701.0 642.9
----------- ----------- -----------
Employee compensation and benefits 119.3 124.2 119.2
Marketing and business development 174.0 164.4 201.2
Info. processing and communications 116.9 114.4 115.5
Facilities and equipment 15.4 14.8 13.7
Other 94.1 85.8 89.2
----------- ----------- -----------
Total non-interest expenses 519.7 503.6 538.8
----------- ----------- -----------
Income before income taxes 163.1 197.4 104.1
Income tax expense 59.7 73.1 41.8
----------- ----------- -----------
Net income $ 103.4 124.3 62.3
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Credit Services Income Data
(in millions)
(unaudited, GAAP basis)
FOR THE QUARTER ENDED
9/30/95 6/30/95 3/31/95
----------- ----------- -----------
Merchant and cardmember fees $ 285.8 265.6 240.3
Servicing fees 187.8 174.2 172.3
Other 0.8 0.4 0.3
----------- ----------- -----------
Total non-interest revenues 474.4 440.2 412.9
----------- ----------- -----------
Interest revenue 639.9 596.9 563.5
Interest expense 247.5 236.4 225.7
----------- ----------- -----------
Net interest income 392.4 360.5 337.8
Provision for loan losses 190.2 135.7 117.5
----------- ----------- -----------
Net credit income 202.2 224.8 220.3
----------- ----------- -----------
Net operating revenues 676.6 665.0 633.2
----------- ----------- -----------
Employee compensation and benefits 112.3 104.8 102.3
Marketing and business development 187.6 132.0 124.5
Info. processing and communications 107.2 105.4 90.9
Facilities and equipment 13.5 12.1 11.8
Other 77.1 85.4 91.1
----------- ----------- -----------
Total non-interest expenses 497.7 439.7 420.6
----------- ----------- -----------
Income before income taxes 178.9 225.3 212.6
Income tax expense 66.9 84.7 80.6
----------- ----------- -----------
Net income $ 112.0 140.6 132.0
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Credit Services Income Data
(in millions)
(unaudited, GAAP basis)
FOR THE QUARTER ENDED
12/31/94 9/30/94 6/30/94
----------- ----------- -----------
Merchant and cardmember fees $ 268.9 238.6 216.1
Servicing fees 162.3 145.9 131.7
Other 0.2 0.4 0.1
----------- ----------- -----------
Total non-interest revenues 431.4 384.9 347.9
----------- ----------- -----------
Interest revenue 522.6 515.3 472.0
Interest expense 197.8 178.8 162.6
----------- ----------- -----------
Net interest income 324.8 336.5 309.4
Provision for loan losses 206.5 134.9 95.8
----------- ----------- -----------
Net credit income 118.3 201.6 213.6
----------- ----------- -----------
Net operating revenues 549.7 586.5 561.5
----------- ----------- -----------
Employee compensation and benefits 97.2 95.4 91.9
Marketing and business development 177.7 146.8 96.8
Info. processing and communications 95.7 85.4 81.9
Facilities and equipment 11.5 11.3 13.8
Other 83.3 71.6 67.8
----------- ----------- -----------
Total non-interest expenses 465.4 410.5 352.2
----------- ----------- -----------
Income before income taxes 84.3 176.0 209.3
Income tax expense 32.4 66.4 80.1
----------- ----------- -----------
Net income $ 51.9 109.6 129.2
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Securities Income Data
(in millions)
(unaudited, GAAP and Managed loan basis)
FOR THE QUARTER ENDED
6/30/96 3/31/96 12/31/95
----------- ----------- -----------
Commissions $ 303.8 300.7 273.8
Asset management and admin. fees 285.8 274.9 258.6
Principal transactions 114.5 118.9 111.1
Investment banking 57.6 64.7 48.8
Other 32.3 19.7 23.1
----------- ----------- -----------
Total non-interest revenues 794.0 778.9 715.4
----------- ----------- -----------
Interest revenue 189.9 186.2 206.4
Interest expense 122.1 115.6 126.9
----------- ----------- -----------
Net interest income 67.8 70.6 79.5
Provision for losses on receivables 2.9 3.0 5.6
----------- ----------- -----------
Net credit income 64.9 67.6 73.9
----------- ----------- -----------
Net operating revenues 858.9 846.5 789.3
----------- ----------- -----------
Employee compensation and benefits 433.6 446.1 377.7
Marketing and business development 27.4 27.5 22.8
Info. processing and communications 69.0 67.7 76.0
Facilities and equipment 48.3 46.4 48.2
Other 55.6 55.8 76.1
----------- ----------- -----------
Total non-interest expenses 633.9 643.5 600.8
----------- ----------- -----------
Income before income taxes 225.0 203.0 188.5
Income tax expense 89.6 81.5 72.7
----------- ----------- -----------
Net income $ 135.4 121.5 115.8
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Securities Income Data
(in millions)
(unaudited, GAAP and Managed loan basis)
FOR THE QUARTER ENDED
9/30/95 6/30/95 3/31/95
----------- ----------- -----------
Commissions $ 266.2 247.9 234.6
Asset management and admin. fees 251.7 251.0 245.5
Principal transactions 121.6 120.8 125.4
Investment banking 45.1 48.7 38.9
Other 15.4 25.7 26.7
----------- ----------- -----------
Total non-interest revenues 700.0 694.1 671.1
----------- ----------- -----------
Interest revenue 204.3 215.7 193.7
Interest expense 127.2 148.0 127.2
----------- ----------- -----------
Net interest income 77.1 67.7 66.5
Provision for losses on receivables 2.5 1.9 3.2
----------- ----------- -----------
Net credit income 74.6 65.8 63.3
----------- ----------- -----------
Net operating revenues 774.6 759.9 734.4
----------- ----------- -----------
Employee compensation and benefits 399.2 384.7 381.4
Marketing and business development 16.8 27.0 23.2
Info. processing and communications 62.7 66.3 63.5
Facilities and equipment 47.3 46.3 42.6
Other 71.8 75.6 74.0
----------- ----------- -----------
Total non-interest expenses 597.8 599.9 584.7
----------- ----------- -----------
Income before income taxes 176.8 160.0 149.7
Income tax expense 70.1 63.1 59.6
----------- ----------- -----------
Net income $ 106.7 96.9 90.1
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
Quarterly Securities Income Data
(in millions)
(unaudited, GAAP and Managed loan basis)
FOR THE QUARTER ENDED
12/31/94 9/30/94 6/30/94
----------- ----------- -----------
Commissions $ 211.6 208.2 206.9
Asset management and admin. fees 245.3 243.9 243.5
Principal transactions 121.6 105.8 102.1
Investment banking 41.1 32.5 40.3
Other 30.5 12.3 36.2
----------- ----------- -----------
Total non-interest revenues 650.1 602.7 629.0
----------- ----------- -----------
Interest revenue 183.7 138.5 132.2
Interest expense 122.0 84.8 83.7
----------- ----------- -----------
Net interest income 61.7 53.7 48.5
Provision for losses on receivables 3.3 2.2 2.3
----------- ----------- -----------
Net credit income 58.4 51.5 46.2
----------- ----------- -----------
Net operating revenues 708.5 654.2 675.2
----------- ----------- -----------
Employee compensation and benefits 330.9 337.3 340.6
Marketing and business development 24.0 20.7 23.6
Info. processing and communications 68.7 60.8 65.9
Facilities and equipment 46.2 46.8 43.6
Other 90.5 64.4 72.7
----------- ----------- -----------
Total non-interest expenses 560.3 530.0 546.4
----------- ----------- -----------
Income before income taxes 148.2 124.2 128.8
Income tax expense 60.1 49.3 51.1
----------- ----------- -----------
Net income $ 88.1 74.9 77.7
=========== =========== ===========
<PAGE>
DEAN WITTER, DISCOVER & CO.
STATISTICAL SUMMARY
Second Quarter
June 30, 1996 June 30, 1995
------------- -------------
Consolidated
Equity at end of period (millions) $ 4,953.3 4,524.1
Return on average equity (1) -- --
Pro forma book value per share - EOP $ -- --
Invstmt in SPSTSI-EOP mkt val (mil) $ -- --
Credit Services ($millions)
Managed loans
Average $ 31,848.6 26,554.6
End of period $ 32,357.3 27,072.0
Interest yield 14.6% 15.3%
Interest spread 8.4% 8.4%
Net charge-off rate 5.4% 3.5%
Average total earning assets $ 33,209.9 27,372.6
Average total earning assets net
int margin 8.7 8.9
General purpose credit card mgd loans
Average $ 28,177.0 23,167.7
End of period $ 28,754.3 23,646.8
Net charge-off rate 5.5% 3.6%
Owned loans - EOP $ 19,525.9 16,802.8
- ----------
(1) Twelve month trailing return on average equity.
<PAGE>
DEAN WITTER, DISCOVER & CO.
STATISTICAL SUMMARY
Year-to-date
June 30, 1996 June 30, 1995
------------- -------------
Consolidated
Equity at end of period (millions) $ 4,953.3 4,524.1
Return on average equity (1) 18.6% 18.7%
Pro forma book value per share - EOP $ 30.07 27.47
Invstmt in SPSTSI-EOP mkt val (mil) $ 360.0 692.5
Credit Services ($millions)
Managed loans
Average $ 31,627.8 26,032.5
End of period $ 32,357.3 27,072.0
Interest yield 14.7% 15.2%
Interest spread 8.4% 8.4%
Net charge-off rate 5.1% 3.3%
Average total earning assets $ 33,014.0 26,782.1
Avg tot earning assets net int margin 8.7% 8.8%
General purpose credit card mgd loans
Average $ 27,816.4 22,960.5
End of period $ 28,754.3 23,646.8
Net charge-off rate 5.1% 3.4%
Owned loans - EOP $ 19,525.9 16,802.8
General purpose credit card accts (mil) 37.7 33.5
NOVUS Network incr in merch loc. (thou) 209 154
SPS # of point of sale trans. (mil) 202.0 175.4
Securities ($billions)
Account executives 8,823 8,054
Total client assets $ 234.2 204.5
Assets under management and administration:
Equity funds $ 34.7 25.9
Fixed income funds 24.0 25.1
Money market funds 23.1 20.0
Investment management services 2.8 2.3
Total $ 84.6 73.3
ICS Assets $ 9.8 7.2
(1) Twelve month trailing return on average equity.
