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Bank of America Corp. said Monday that it is selling an $8.6 billion credit card portfolio in Canada and plans to unload $19 billion of card loans in Europe as it works to exit the international card business.
August 15 -
More banks are likely to follow in Regions Financial Corp.'s footsteps and bring their credit card portfolios back in-house as the worst of the recession's damage recedes and they look to increase revenue.
June 10
Sovereign Bank is taking its credit card operations in house.
The $77 billion-asset bank said Tuesday that it is planning to purchase the Sovereign-branded credit card portfolio from FIA Card Services. The portfolio contains roughly 105,000 accounts representing about $200 million in balances, and Sovereign said that the vast majority of customers also have other accounts with the bank.
"The acquisition of our portfolio will strengthen our relationship with credit card customers and is a key step towards the development of new...credit card products," said Nuno Matos, managing director of retail banking at Sovereign, in a news release. "This will allow us to fully manage the whole financial relationship and provide more convenient service to our customers."
Sovereign, a Boston-based unit of Spanish banking giant Banco Santander S.A., did not disclose a purchase price. It said that FIA, a unit of Bank of America Corp. that issues and administers cards for other lenders, will continue servicing the accounts until the sale and transfer are completed in 2012.
Sovereign is the second bank in recent months to announce that it is taking over management of its credit cards. In June, Regions Financial Corp. in Birmingham said that it is buying back its $1 billion, Regions-branded credit card portfolio from FIA.
The sales are consistent with Bank of America's stated strategy of focusing on its core credit-card customers. Earlier this month it said it intends to sell $8.6 billion of card loans in Canada and another $19 billion in Europe as part of a broader plan to exit the international card business.
