JPMorgan CEO Jamie Dimon isn’t afraid of a merged Capital One and Discover

JPMorgan Chase CEO Jamie Dimon isn’t shaken by the threat of a larger Capital One, backed by its pending $35.3 billion takeover of Discover Financial, which would create the largest credit card company in the U.S. by loan volume.

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“My view is, let them compete,” Dimon told CNBC on Monday (Feb. 26) at the 2024 Global High Yield & Leveraged Finance Conference in Miami Beach, Florida.

“Let them try, and if we think it’s unfair, we’ll complain about that,” he added.

The proposed union of Capital One and Discover is the largest potential merger of 2024, narrowly surpassing tech design firm Synopsys’s $35 billion acquisition of software developer Ansys. It could transform the credit card and payment network industry.

Together, the two companies have $257 billion in outstanding credit card loans, about $46 billion more than JPMorgan Chase. Plus, the deal gives Capital One control of and access to revenue generated by Discover’s payment network of 70 million merchant acceptance points worldwide.

“Our acquisition of Discover is a singular opportunity to bring together two very successful companies with complementary capabilities and franchises, and to build a payments network that can compete with the largest payments networks and payments companies,” Capital One co-founder and CEO Richard Fairbank said in a statement last week.

Dimon acknowledged his competitor’s new strength, telling CNBC that “they’ll be bigger” and have greater scale, adding that he has “enormous respect” for Fairbank and his bank.

Dimon also said Capital One would have an “unfair advantage” in debit payments because of the Durbin Amendment (pdf), which limits debit fees for large banks, but doesn’t apply to Discover or American Express.

“Of course, I have a problem with that,” Dimon told CNBC. “You know, like why should they be allowed to price debit different than we price debit just because of a law that was passed?”

The deal between Discover and Capital One isn’t set in stone, as
U.S. government regulators must still approve the acquisition. On Sunday, a group of 13 Democratic lawmakers led by Senator Elizabeth Warren of Massachusetts urged federal regulators to block the deal.

“To protect consumers and financial stability, we urge you to block this merger and strengthen your proposed policy statement to prevent harmful deals in the future,” the lawmakers wrote in a letter to the U.S. Federal Reserve and the Office of the Comptroller of the Currency.

Notably, the Biden administration set a new record for merger enforcement activity in 2022, bringing forward 50 enforcement actions between the U.S. Federal Trade Commission and Department of Justice, according to Bloomberg. On Monday, the FTC sued to block Kroger’s $24.6 billion acquisition of Albertsons.