Discover Financial CEO Michael Rhodes leaves for Ally Financial

  • After less than nine weeks in the position
  • Michael Shepherd taking over temporarily

(exechange) — Riverwoods, Illinois, March 27, 2024 — Michael Rhodes, chief executive of Discover Financial, leaves his position. As announced by Discover Financial Services in a regulatory filing published on Wednesday, March 27, 2024, Michael G. Rhodes leaves his post as chief executive officer at the financial services company that owns and operates Discover Bank, after less than nine weeks in the role, effective April 1, 2024.

Generally speaking, it raises questions when a CEO leaves his post at short notice and after a short tenure.

Michael Rhodes’s duties as CEO will be taken over temporarily by J.Michael Shepherd, a former Chief Executive Officer at BancWest Corporation and Bank of the West, as Interim Chief Executive Officer.

Already a director

Shepherd has already been a member of the board of directors of Discover Financial. Generally speaking, most director-turned-CEO appointments occur following a sudden resignation of the outgoing CEO and signal a lack of preparedness on the company’s part to groom internal talent. Directors-turned-executives represent a blend of outsider and insider.

They don’t have the constraints of a pure insider when it comes to leading painful changes or making unpopular decisions, and they have more company knowledge than a pure outsider.

Having been a director, Shepherd understands the expectations and dynamics of the board and has knowledge of Discover Financial’s organization, risk-management practices and strategy.

Career change

The management change is explained as follows. Discover Financial stated: “Mr. Rhodes, who was not expected to have a long-term role at the combined company after completion of the Company’s merger with Capital One Financial Corporation, informed the Board that he has accepted a job offer at another financial institution.”

Rhodes will be CEO at Ally Financial

Michael Rhodes will take on a new role as the CEO at Ally Financial Inc., as was also reported. Ally Financial stated: “Ally Financial Inc. … announced today that Michael G. Rhodes will be its new Chief Executive Officer, starting at the company on April 29, 2024.”

Ally Financial announced the move on Wednesday, March 27, 2024.

Ally Financial is a financial services company.


Discover Financial said: “On March 26, 2024, the Board of Directors … of Discover Financial Services … accepted the resignation of Michael G. Rhodes from his positions as Chief Executive Officer and President of the Company, a member of the Board and a director and officer of Discover Bank …, each effective April 1, 2024.”

Share price increase since February 2024

The announcement follows an increase in Discover Financial Services’s share price of 18% since February 2024. February 2024 is the month in which Rhodes’s tenure as CEO began.

In the position of CEO since 2024

Michael Rhodes became CEO of the Company in 2024.

Rhodes was appointed as the Company’s CEO and President and to the Board, effective February 1, 2024.

He was recommended to the Company by an outside search firm.

Michael G. Rhodes is the Company’s CEO and President, having joined Discover in February 2024.

Prior to joining Discover, Rhodes was the Group Head, Canadian Personal Banking at TD Bank Group (“TD”).

He joined TD in 2011 to lead the North American Credit Card and Merchant Services business, and from 2017 to 2021, he also served as the Group Head, Innovation, Technology and Shared Services.

His experience also includes leadership roles at both Bank of America and MBNA America Bank.

Rhodes earned his MBA from the Wharton School at the University of Pennsylvania and holds a bachelor’s degree in engineering from Duke University.

At the time of Michael Rhodes’s appointment as Chief Executive Officer at Discover Financial, Tom Maheras, Chair of the Board, had said: “Michael’s appointment follows a comprehensive search process to identify the right leader to help the Company deliver on its strategic and financial goals. He is an experienced executive and proven leader who has worked in a variety of roles within the payments and banking industry around the globe and has a track record of successfully leading sophisticated financial services operations. I am confident that under his leadership, Discover will be able to reach its full potential and take care of its customers at the highest industry levels while continuing to advance its commitments to enhancing compliance, risk management and corporate governance.”

At the time of Michael Rhodes’s appointment as Chief Executive Officer at Discover Financial, Rhodes had said: “I am honored to be joining Discover at such an important time for the Company and leading its 20,000 employees to deliver on their important mission of helping people achieve brighter financial futures. Throughout my career I’ve developed a clear understanding of what it takes to deliver a great customer experience at every touch point, and I am confident that with its strong foundation and employee-base, Discover is well-positioned to capitalize on the market opportunities ahead. I look forward to working with Tom and the management team and the rest of my colleagues, as Discover continues to advance its culture with a focus on compliance and serving customers while driving sustainable long-term financial performance.”

No statement by Michael Rhodes in the departure announcement

The announcement of his departure as CEO does not include a statement by Michael Rhodes.

“’Do It Right’ mantra”

In the announcement from Ally Financial Inc., Rhodes stated: “I have long admired Ally’s transformational approach to digital banking and its leading position in automotive finance. The bank has successfully harnessed the power of technology to create financial solutions for its customers and communities consistent with its ‘Do It Right’ mantra. I am so pleased the Board has put its trust in me to continue advancing Ally’s strategy alongside the strong leadership team. I am eager to roll up my sleeves and, together with more than 11,000 Ally teammates, get to work.”

The above text is an excerpt from the exechange report 14.2024 ($), publication date April 1, 2024.