- Key insight: Capital One will expand its business payments capabilities by acquiring Brex for $5.15 billion in cash and stock.
- What’s at stake: Brex offers corporate card services, expense management and payments solutions for businesses, especially startups.
- Forward look: Capital One expects the deal to close in mid-2026.
UPDATE: This story includes additional information about Capital One’s fourth-quarter results, the impact of the Discover acquisition and comments from the company’s earnings call.
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Capital One Financial announced Thursday that it will acquire payments-focused fintech Brex in a deal valued at $5.15 billion.
The half-cash and half-stock deal, expected to close in mid-2026, marks the bank’s latest acquisition, following its landmark purchase of Discover Financial Services last year for $51.8 billion.
McLean, Virginia-based Capital One said it entered into a merger agreement with Brex on Thursday, as it simultaneously announced its fourth-quarter earnings.
“Since our founding, we set out to build a payments company at the frontier of the technology revolution,” Capital One Chairman and CEO Richard Fairbank said in a prepared statement. “Acquiring Brex accelerates this journey, especially in the business payments marketplace.”
While the Discover acquisition was focused on consumers, the Brex deal is about expanding services for businesses. Fairbank told analysts on Thursday night that business payments have been a “growing part of [Capital One’s] strategy and investment agenda.”
Brex offers corporate card services, expense management and payments solutions for businesses, especially startups. The company has partnered with other financial institutions like Stripe and Fifth Third in the last year to expand its product suite and its distribution network.
“Our announcement today represents an important step change towards our business payments destination in a broader marketplace that we believe is ripe for reinvention,” Fairbank said.
Brex has its roots in the startup world, but Fairbank said about 60% of Brex’s originations over the last two years have been to non-tech companies. He added that the fintech’s clients include Anthropic, Robinhood Markets, TikTok, Coinbase, CrowdStrike and DoorDash.
Capital One plans to spend about $950 million on transaction-related costs, including integration and retention compensation incurred over the next three years.
Fairbank said on the company’s call with analysts that the deal will lead to earnings dilution initially, but should eventually contribute “significant accretion over time.” He declined to provide specific financial details.
Brex Founder and CEO Pedro Franceschi said in a prepared statement that the deal will “supercharge” the firm’s growth “by combining Brex’s payments expertise and spend management software with Capital One’s massive scale, sophisticated underwriting, and compelling brand.”
Franceschi will continue to lead the fintech as part of Capital One.
Credit card concerns
Capital One’s latest acquisition comes as new credit-card policies being pushed by President Donald Trump could put pressure on companies that specialize in the card business.
The $669 billion-asset bank is the largest credit-card lender in the country — a title it snagged when it acquired Discover. Slightly more than 75% of the bank’s revenue in the fourth quarter came from its massive, $280 billion card portfolio.
But as Trump seeks to enact rules that would cap credit card rates at 10%, large banks might have to figure out ways to pad lost earnings. Capital One’s credit cards for consumers offer rates ranging between 18% and 29%, though some of the cards have short-term introductory annual percentage rates of 0%, per its website.
Fairbank told analysts on Thursday that he thinks a cap on credit card rates would “catalyze a number of unintended consequences,” because banks like Capital One “would be compelled” to restrict credit and originations to “a very small subset of customers.”
“We appreciate the energy to help consumers with affordability on many aspects of their spending,” Fairbank said. “Putting a price control in place, such as the proposed rate cap, would not make credit more affordable. It would make credit much less available for consumers up and down the credit spectrum.”
Discover details
In the fourth quarter, Capital One spent $898 million in connection with the Discover deal, the company said Thursday. Costs related to the acquisition will exceed the originally expected $2.8 billion, Fairbank said in the fall, though he didn’t specify by how much.
The Discover deal closed last May after a 15-month process — longer than the two banks had anticipated when they inked the merger agreement. But Fairbank has been resolute about the benefits of the transaction, especially those resulting from the acquisition of Discover’s payment network.
Fairbank said Thursday that Capital One is “well down the path of what I think is a very successful integration.”
One of the biggest to-do items: building merchants’ acceptance of the Discover network internationally as well as recognition of the brand overseas, which Fairbank described Thursday as “a long journey.” He said the company is putting the most emphasis on geographic areas where Americans more commonly travel.
Capital One has nearly completed its transition of its debit-card accounts to the Discover network, Fairbank said. He added that the bank should be able to originate Capital One credit cards on the Discover network by the middle of the year, and will begin moving some existing cards over early next year.
The acquisitions of Discover and Brex are examples of the kinds of investments that Capital One prioritizes, Fairbank said. He said although there may be near-term pressure on the company’s efficiency ratio — a measure of expenses versus revenue — he’s confident in the company’s earnings power on the other side of the integrations.
“Our 2025 performance was enabled by years of strategic preparation, and our choice to consistently invest to sustain long-term growth and returns,” Fairbank said. “And these same choices put us in a strong position going forward. As we enter 2026, I’m struck by the number and quality of the opportunities we have before us.”
Fourth-quarter financials
During the fourth quarter, Capital One logged $2.1 billion of net income, down 33% from the previous quarter, as the bank’s expenses and its provision for credit losses both went up.
The company’s diluted earnings per share of $3.26 just beat consensus analyst estimates of $3.23. On an adjusted basis, earnings per share were $3.86, which fell short of the $4.14 consensus of analysts polled by S&P.
The company’s stock has fallen roughly 5% since the beginning of the year, while the KBW Nasdaq Bank Index has inched up by less than 1%. Capital One’s stock was down about 3% after hours on Thursday, as investors digested the Brex acquisition news and the earnings results.
In recent months, Fairbank has repeatedly touted Capital One’s confidence in its credit quality, capital levels and the synergies that will result from the Discover acquisition.
He added on Thursday that he thinks the health of the economy and U.S. consumers is in a “pretty good place,” despite some “elevated economic uncertainty.”
In the fourth quarter, Capital One bought back $2.5 billion worth of shares, on top of $1 billion it repurchased in the third quarter. The bank announced in October that it would deploy capital by buying back up to $16 billion of shares. It said Thursday that the acquisition of Brex won’t impact the pace or magnitude of its share repurchases.