Discover Financial Services announced Friday that its No. 2 executive, president and chief operating officer Roger C. Hochschild, will become chief executive on Oct. 1, succeeding long-time chairman and CEO David W. Nelms.
Nelms, 57, Discover’s CEO since February 2004, will become executive chairman at that time before retiring in early 2019, Riverwoods, Ill.-based Discover said. With American Express Co. CEO Kenneth I. Chenault having retired in February, Nelms will become the second CEO of one of the four U.S.-based general-purpose card networks to retire in the span of about a year.
Hochschild, 53, joined Morgan Stanley’s Discover credit card operation in 1998, serving as chief marketing officer for three years before becoming executive vice president and chief administrative and strategic officer. He became president and COO in 2004 and will retain his title as president come October.
“The board and I are confident that Roger is the right choice to lead the company into its next period of growth,” Lawrence Weinbach, Discover’s lead independent director, said in a statement. “His deep industry experience as well as his strong business and customer insights will help Discover continue to achieve industry-leading results. David and Roger both joined the company in 1998, and together they have led Discover to deliver exceptional customer experience, financial returns and shareholder value.”
Before Discover, Hochschild worked for the consulting firm Booz Allen and later served in various leadership positions at MBNA Corp., a large credit card issuer that Bank of America Corp. bought in 2006. He received his undergraduate degree from Georgetown University and his master of business administration degree from The Amos Tuck School at Dartmouth College.
“Roger’s deep experience and proven results make him well suited to lead Discover to new heights of success,” Nelms said in a statement. “He has been integral to Discover’s growth and to our achievement of an average 19% [return on equity] over the past 20 years, and has remained steadfast in his commitment to customers.”
Nelms, too, is an MBNA veteran, eventually becoming vice chairman after coming to that company in 1991. He joined Discover 12 years after its 1986 founding by Sears, Roebuck & Co., serving as president and chief operating officer for six years before taking the top job in 2004.
Nelms led Discover through its spin-off from Morgan Stanley in 2007. Although lending remains Discover Financial’s biggest business—besides being a major credit card issuer it claims to be the nation’s No. 2 private student-loan provider—the company under his leadership positioned itself as an alternative for merchants to the older Visa, Mastercard, and AmEx networks. Discover struck partnerships with bank card merchant acquirers to grow its acceptance base, and it branched into new markets through acquisitions. They included the Pulse debit network in 2004 and Diners Club International in 2008, the latter giving Discover access to numerous international markets.