(In Feb. 22 story, corrects to "certain circumstances" from

"any circumstances" in paragraph 1)

Feb 22 (Reuters) - Discover Financial Services ( DFS )

or Capital One Financial ( COF ) will pay a termination fee of

$1.38 billion if the merger of the firms falls through under

certain circumstances, a regulatory filing showed on Thursday.

The all-stock deal announced on Monday would create the

biggest U.S. credit card issuer, but it would also give Capital

One access to Discover's payment network, allowing it to rely

less on payments giants Visa and Mastercard ( MA ).

Capital One, the third-largest issuer of Visa and

MasterCard ( MA ) credit cards in the United States, said earlier in

the week, shifting its card portfolio from those two payment

giants to Discover's network would help it generate $1.2 billion

in 2027.