Discover may face downgrade on new credit card law

American Express Co., Discover Financial Services and Capital One Financial Corp. may face ratings downgrades after new U.S. credit-card regulations reduce profits for the lenders, according to CreditSights Inc.

The rules passed by Congress on May 20 limit companies' ability to impose fees and increase rates, hurting profits of firms that get at least half of their revenue from credit-card lending, analyst David Hendler said in a research note. Discover, based in Riverwoods, has the "greatest risk" and may be cut below investment grade, Hendler said.