Discover Financial Services reported a slowdown in growth in its credit card business but vowed to take steps to reverse the trend.
During the fourth quarter of 2015, credit card loans at Discover grew by 3.1% from the same period a year earlier, the company said Wednesday. That growth rate peaked at 6.6% in the third quarter of 2014 and has declined in each of the last five quarters.
Chief Executive Officer David Nelms said in a press release that credit card loan growth was “slower than we’d like” during the final quarter of the year.
“We are taking steps to accelerate card loan growth in 2016 while staying disciplined on credit,” he added.
Earlier this week Discover started marketing a secured credit card that is designed to bring aboard more customers with lower credit scores.
Discover’s total loans grew 3.5% year over year, aided by a 9.6% increase in personal loans. For 2016 Discover is projecting total loan growth of 4% to 6%.
The Riverwoods, Ill.-based company reported net income of $500 million during the fourth quarter. While that was up from $404 million during the same period a year earlier, the firm’s latest results were hurt by $205 million in one-time charges.
Discover reported earnings per share of $1.14 for the quarter, which fell short of the $1.31 projected by analysts polled by Bloomberg.
The company’s chargeoff rate was 2.02%, down from 2.06% during the fourth quarter of 2014. Discover’s provision for loan losses grew by 5% to $1.5 billion.