FS Card announced Thursday that Republic Bank & Trust in Louisville, Ky., will issue its new subprime credit card, which is scheduled to be launched this spring.
FS Card is led by former executives of Capital One Financial's credit-card business and ex-officials at the Consumer Financial Protection Bureau. It's owned by Fenway Summer, a firm started by former CFPB Deputy Director Raj Date.
The Washington, D.C.-based FS Card first announced plans for a subprime credit card last February. But one sticking point has been naming a bank to issue the product, which is being called the Build Card.
"Our credit program, together with Republic Bank's tenure and experience as a leading consumer bank," FS Card Chief Executive Officer Marla Blow said in a news release, "will deliver an efficient and scalable unsecured credit product that can grow rapidly to meet the needs of underserved consumers."
Blow said in an interview that the Build Card will be targeted at customers with credit scores below 620. U.S. consumers with low credit scores have had a hard time getting credit cards over the last five years, as the subprime card market has shrunk substantially in the wake of the recession and in the face of new regulations.
The $3.6 billion-asset Republic Bank has been looking for new lines of business since it agreed to end its tax-refund-anticipation loan business in late 2011. That move followed a long fight with the Federal Deposit Insurance Corp., which opposed refund-anticipation loans.
In 2013, Republic announced plans to buy the assets and nearly all of the deposits of H&R Block Bank, in a deal that would have allowed the bank to offer H&R Block-branded financial services. But the acquisition fell through, apparently because regulators objected.