Discover says spending becoming more cautious, sees pressure on expenses

Discover seeing signs that the consumer is becoming more cautious. Says spend levels more cautious and coming down. Says this April, overall spend levels were up 3%, which is negative when adjusted for inflation. That trend continued into May and into June. The company also notes that it is seeing some pressure on expenses. “We expect that we’re going to continue to invest so that our compliance management system meets our high standards and the high standards of the regulators. Now, we got more work to go in order to get there… But in the short term — next couple of years — we’re going to be investing heavily in those areas. So that 10% factor or 10% overall guide for expense growth — we are seeing pressure on it. We’ll see how the balance of this year turns,” Discover says. From 2019 to 2023, what we expect this year, kind of the increase in risk and compliance, $250M to the firm.” Comments taken at the Morgan Stanley US Financials Payments & CRE Conference.