Concerns over credit quality have driven down the prices of credit card portfolios, according to a survey by R.K. Hammer Investment Bankers.

Average weighted premiums on portfolio sales dropped to 13.25% in the first seven and a half months of 1997, from 17.70% in the same period last year.

The survey covered 13 sales of portfolios, ranging from $20 million to $1 billion and totaling $4.5 billion.

Robert K. Hammer, president of the Thousand Oaks, Calif., banking firm, said he expects another $7 billion or $8 billion of sales to occur this year, bringing the total of deals to about 20.

"This is a weakened market," Mr. Hammer said. The survey findings "are a reflection of concerns over credit quality and the lower earnings that would result" from portfolios with high delinquency and chargeoff rates, he said.

Conversely, the average size deal this year rose to $346 million, up from $295 million last year. Typically, about two-thirds of the deals are for less than $100 million, Mr. Hammer said, because most banks selling portfolios tend to be smaller.

This year is different because issuers across the board are affected by record delinquency and chargeoff rates, he said.

Banks, he said, are selling card portfolios because they want to focus on core markets or bolster loan-loss reserves. Or a bank may decide to sell because a cobranding or affinity card relationship has ended.

This year Barnett Banks of Florida sold part of its portfolio to Household International because it wanted to focus on customers in its home state. Household took over the accounts outside Florida.

Bank of New York Co., which has been suffering from high delinquency rates, has made multiple sales this year. There is speculation that it will soon sell the remainder of its portfolio to Chase Manhattan Corp.

A number of cobranding relationships have unraveled this year, including most recently the NationsBank-Blockbuster Entertainment program. Mr. Hammer said he would not be surprised if NationsBank soon puts its Blockbuster accounts on the block.

Mr. Hammer said card issuers today are more likely to sell pieces of their portfolios than to exit the business entirely. He cited deals by Norwest Corp., CoreStates Financial Corp., and Bank of New York, each of which shed portfolio pieces that were deemed the least successful.

Partial portfolio sales are largely driven by issuers' data mining skills, Mr. Hammer said. Card issuers are better able to identify which portions of their card portfolios should be sold because they can predict how those accounts will perform.

The most aggressive buyers of portfolios this year are Chase Manhattan, PNC Bank Corp., Associates First Capital, and GE Capital Services. Associates and the General Electric Co. unit accounted for more than two- thirds of the purchases this year.

While a significant number of portfolios were sold at below 14% premiums, Mr. Hammer said, higher-quality portfolios remain, with chargeoff rates around 3% or 4%, that are selling for 16.3% to 19.3% premiums.

Accounts in better portfolios can sell for $75 to $100 apiece. Lower- quality accounts go for as little as $40.

Mr. Hammer's survey did not include transactions of less than $15 million, of which he estimates there are 50 to 60 per year. He also did not include card portfolios sold as a result of a banking acquisition, such as Banc One Corp.'s takeover of First USA Inc.

Donald Berman, president of Cardholder Management Services of Plainview, N.Y., said Mr. Hammer's findings are "not surprising."

"Premiums are coming down because portfolios are not as profitable as they were last year," Mr. Berman said. "What we are seeing are larger- portfolio owners deciding they can't compete and selling part or all of their portfolios."

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