Bank of America Corp. sold $700 million in credit card assets to U.S. Bancorp on Wednesday, in the struggling Charlotte company's latest effort to slim down.
U.S. Bancorp said Wednesday that its Elan Financial Services unit bought the credit card assets of 28 financial institutions from B of A's FIA Card Services N.A. The portfolio includes cards issued on behalf of investment advisory firm Edward Jones.
The financial terms of the deal, which closed on Wednesday, were not disclosed. Customers can continue using their existing cards until Elan issues new ones in 2012.
"This portfolio of financial institutions represents a significant opportunity for Elan," Pamela Joseph, vice chairman and head of U.S. Bancorp Payment Services, said in a press release. "They are highly regarded financial service partners to millions of Americans and we share their commitment to adding high quality financial services for their clients that can help them achieve their goals."
U.S. Bancorp has previously done similar credit card deals with other beleaguered banks. In 2009, the Minneapolis company purchased three credit card portfolios totaling $1.3 billion in managed assets from Citi Holdings, Citigroup Inc.'s repository for unwanted businesses. At that time Citigroup was looking to sell or wind down many of its non-core credit card portfolios, but it has since reincorporated that unit into its core business.
B of A has made several deals recently to shrink its cards business as it works to focus on its main banking businesses. The company sold its $8.6 billion Canadian credit card portfolio to Toronto-Dominion Bank and in August reached an agreement to sell about $200 million in card balances to Sovereign Bank.