The credit card provider announced the leadership change late Monday (Aug. 14), weeks after the company revealed it was the subject of a possible action by the Federal Deposit Insurance Corp. (FDIC).
Hochschild, the company’s former chief operating officer, was named CEO in 2018.
“The Board and Roger have agreed that now is the right time to transition leadership, and we thank Roger for his 25 years of service to the Company,” said Tom Maheras, board chairman.
“The Board is continuously focused on Discover reaching its full potential across the business, including our commitment to enhancing compliance, risk management and corporate governance. We will continue to take actions to advance Discover’s strategic priorities and generate high returns and capital.”
During an earnings call in July, the company revealed it was facing a possible FDIC consent order in connection with consumer compliance issues, while also acknowledging it had been overcharging merchants for years.
“Beginning around mid-2007, we incorrectly classified certain card accounts into our highest merchant and merchant-acquiring pricing tier,” Hochschild said at the time.
The company said that it was in talks with its regulators on this matter, as well as about corporate governance and risk management, and was pausing its share repurchasing program while that work was underway.
“In addition, the Company received a proposed consent order from the FDIC in connection with consumer compliance,” Discover said in its earnings report. “This proposed consent order does not include the card product classification matter. Additional supervisory actions could occur.”
The company’s stock has fallen nearly 16% since then.
Replacing Hochschild in the interim will be John Owen, a member of the board and retired executive from Regions Financial, where he served as chief operating officer.
He predicted that these schemes will continue to be a success in their local markets and will be crucial to increasing financial inclusion and ushering unbanked populations into the digital age, with greater scale and more transaction volumes across the networks.
“We’re bullish about domestic schemes,” Leite told PYMNTS’s Karen Webster, adding that “we want to continue to partner with them — and support them, in any of the ways they need.”