Bank of Monteral has agreed to buy Citigroup Inc.'s Diners Club North American franchise, giving the big Canadian chartered bank exclusive rights to issue Diners cards in the U.S. and Canada.
BMO said the move will more than double its overall corporate credit-card business.
Specific financial terms of the acquisition weren't disclosed, but BMO said the deal represents net receivables of almost $1 billion and about $7.8 billion in card transactions.
Citigroup will continue to provide support until the Diners Club business is fully integrated within BMO. As part of the acquisition, BMO will retain key resources responsible for product delivery, sales and customer service.
The acquisition is expected to close before the end of March.
In a separate release, Citigroup said the sale isn't expected to have a material impact on its net income or capital ratios. It said the sale is in line with its strategy to optimize the assets and bussinesses within Citi Holdings, the entity created to hold those businesses Citi considers no longer essential. The sale is expected to reduce its assets in Citi Holdings by about $1 billion.
In Toronto Monday, Bank of Montreal closed at C$53.55, down 32 Canadian cents. It's scheduled to report fourth-quarter earnings later Tuesday.