Bank of America will sell its Irish consumer credit-card unit to Apollo Global, the latest business unit sale by a shrinking B of A.
The bank had earlier said it would look to sell its European consumer credit-card operations because they didn't fit with the overall strategy of CEO Brian Moynihan.
In short, the bank has decided that consumers in foreign lands, where the bank doesn't have retail operations, are not essential to catering to clients in the U.S. The card unit in Ireland joins cards in Spain and Canada in being sold by B of A (with Spain also being acquired by Apollo.)
For Apollo, it is another opportunity as banks reshape themselves. The private equity giant touted in a release about the transaction, which didn't include terms, that the deal was "another example of how Apollo is able to provide a comprehensive solutions to a financial institutions as the seek ways to reshape their balance sheet."
B of A still plans to work with corporate clients on credit-cards around the globe, but didn't think the international business, which was acquired when it bought credit-card giant MBNA, was worth continuing.
Moynihan has been selling several assets to concentrate on core operations and build capital. The capital is needed to meet new regulations and also to fill in for massive mortgage losses and costs related to the housing bubble that remain percolating inside the bank.
Last week, the bank passed the Federal Reserve's stress test, signaling it has enough capital to withstand even another severe economic crunch. But Wednesday's sale will likely further buffer that capital position and may ease investors still unsure about how Bank of America will create profits.
Monday the stock had rallied above $10 a share, doubling from its December lows, but dove back down when a market rumor spread that it could be looking to sell shares. The bank denied the rumor, as it has consistently for a year, and shares recovered Tuesday.
Wednesday the stock was up 1% to $9.91 recently.