Dash for Bankruptcy Costs Discover Over $200 Million
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Dash
for Bankruptcy Costs Discover Over $200 Million
Morgan Stanley
announced Wednesday that its Discover Bank division will see
pre-tax charges in the fourth quarter of fiscal 2005 increase
by $200 to $250 million over those experienced in the third
quarter. Discover blames the charges on a rush of personal bankruptcies
declared to beat an October change in bankruptcy law.
Federal
bankruptcy legislation passed earlier this year makes it more
difficult for individuals declaring bankruptcy to be completely
shielded from creditors. While this promises to help credit
card companies recoup more money in future bankruptcies, Discover
and other credit card issuers are taking a short-term hit thanks
to the many consumers who rushed to beat the October 17th deadline.
Published 11/03/05 (Modified 01/21/13)
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