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"This merger represents yet another struggle to rein in the
economic power of the megabanks, and ensure that our financial
system is designed to serve consumers, small businesses and
communities across America, not Wall Street," Waters said.
Capital One's chances of getting the deal past regulators hinge
on the bank showing it can disrupt the close-knit U.S. credit
card industry, five experts in corporate law interviewed by
Reuters said.
Combining Capital One and Discover, the top four and five
players in the U.S. credit card market by loans, would create
the biggest issuer with around $250 billion in card balances and
a market share of 22%, according to TD Cowen analysts.
"A merger of Capital One and Discover would result in a $625
billion bank, which is larger than the combined size of the
three banks that failed last year, Silicon Valley Bank,
Signature Bank, and First Republic," Waters said.
"The failure of those so-called mid-sized banks required our
government to use its emergency tools to stabilize the banking
system to prevent contagion."
Separately on Wednesday, Axios reported that Senator Josh Hawley
was also calling for the deal to be blocked.
(Reporting by Pritam Biswas and Bhanvi Satija in Bengaluru;
Editing by Maju Samuel)
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