Discover 2015 Annual Report Download - page 71

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The following table presents information on transaction volume (in millions):
For the Years Ended December 31,
2015 2014 2013
Network Transaction Volume
PULSE Network .................................................................................................................. $ 150,145 $ 165,851 $ 159,805
Network Partners ............................................................................................................... 12,965 9,446 9,808
Diners Club(1) ..................................................................................................................... 26,567 26,970 26,867
Total Payment Services ................................................................................................... 189,677 202,267 196,480
Discover Network—Proprietary(2) ......................................................................................... 122,726 119,471 113,791
Total Volume ................................................................................................................. $ 312,403 $ 321,738 $ 310,271
Transactions Processed on Networks
Discover Network .............................................................................................................. 2,033 2,020 1,947
PULSE Network .................................................................................................................. 3,890 4,283 4,187
Total ............................................................................................................................. 5,923 6,303 6,134
Credit Card Volume
Discover Card Volume(3) ..................................................................................................... $ 127,825 $ 125,111 $ 118,594
Discover Card Sales Volume(4) ............................................................................................. $ 118,442 $ 115,518 $ 109,957
(1) Diners Club volume is derived from data provided by licensees for Diners Club branded cards issued outside North America and is subject to subsequent revision or
amendment.
(2) Represents gross proprietary sales volume on the Discover Network.
(3) Represents Discover card activity related to net sales, balance transfers, cash advances and other activity.
(4) Represents Discover card activity related to net sales.
Direct Banking
For the Year Ended December 31, 2015 compared to the Year Ended December 31, 2014
Our Direct Banking segment reported pretax income of $3.5 billion for the year ended December 31, 2015 as
compared to pretax income of $3.6 billion for the year ended December 31, 2014.
Loan receivables totaled $72.4 billion at December 31, 2015, which was up from $69.9 billion at December 31,
2014, due to growth in credit card loans and other loan portfolios, partially offset by a decrease in purchased credit-
impaired ("PCI") student loan balances. Discover card sales volume was $118.4 billion for the year ended December
31, 2015, which was an increase of 2.5% as compared to the year ended December 31, 2014. This volume growth
was driven primarily by an increase in discretionary spending partially offset by the impact of lower gas prices.
Interest income rose over the prior year due to growth in credit card, personal and private student loans, partially
offset by lower yields on personal loans, as well as a decrease in PCI student loan balances. Interest expense increased
during the year ended December 31, 2015 as compared to the year ended December 31, 2014 primarily due to
increases in unsecured debt to fund loan growth.
At December 31, 2015 and December 31, 2014, our delinquency rate for credit card loans over 30 days past
due was 1.72% and 1.73%, respectively. For the year ended December 31, 2015, our net charge-off rate on credit
card loans decreased as compared to the year ended December 31, 2014, however higher levels of net charge-offs
and higher loan balances led to an increase in the provision for loan loss dollars for the year ended December 31,
2015, as compared to the year ended December 31, 2014. For a more detailed discussion on provision for loan losses,
see "— Loan Quality — Provision and Allowance for Loan Losses."
Total other income increased for the year ended December 31, 2015 as compared to the year ended December
31, 2014 primarily due to the combination of a one-time charge from the reversal of the customer rewards forfeiture
accrual, after cashback reward terms were changed in 2014 and an increase in transaction volume, which increased
discount and interchange revenue. The increase in total other income was partially offset by the loss of mortgage
revenue due to the sale of that business and lower protection products revenue reflecting our no longer selling these
products and eliminating related retention efforts.