SAN FRANCISCO – Cards giant Visa Inc. said yesterday that swelling legal reserves set aside to settle numerous antitrust suits pushed it into the red for its fiscal fourth quarter to the tune of $356 million .
The company set aside an additional $1.1 billion in the fourth quarter for litigation costs, wiping out more than $1 billion in net income. For the prior 12 months Visa set aside $2.6 billion for litigation, creating a huge $1.7 billion loss for the year.
Just three days ago Visa announced it has agreed to pay Discover Financial Services $2.5 billion to settle Discover’s antitrust suit claiming Visa and MasterCard conspired to keep banks and credit unions from issuing Discover cards. Earlier this year, Visa agreed to pay American Express $2.7 billion to settle a similar case.
The funds set aside in the litigation will be used to pay those settlements.
Otherwise, Visa said fourth quarter revenues rose 17% to $1.7 billion, and fiscal year revenues rose almost 21% to $6.3 billion.
