After outbidding five of the nation’s largest card issuers for Wachovia Corp.’s $8 billion portfolio of credit card loans, Bank One Corp. said its deal to purchase these sought-after assets signaled the end of troubles at the First USA card division and the beginning of a growth spurt.

Buying Wachovia’s 2.8 million card accounts is “the kind of thing Bank One should be doing,” Bank One chief executive officer James Dimon said Monday. Now that the Chicago banking company has settled consumer lawsuits over unfairly charged late fees and has changed the management in charge at the time, he said, “we are capable of doing something like this.”

Wachovia, of Winston-Salem, N.C., one of the last remaining midsize card issuers, announced in February that it was interested in selling the business. Wachovia executive vice president Beverly B. Wells said Monday that prospectuses were sent to 20 companies and that six were left in the final round of due diligence. Industry insiders say the other five likely included Citigroup Inc., MBNA Corp., and FleetBoston Financial Corp., and perhaps American Express Co.

Mr. Dimon would not disclose the premium Bank One paid for the portfolio. Wachovia said it expects to report a pretax gain of about $1.4 billion after the deal closes, which would represent a 17.5% premium, slightly lower than last year’s industry average of 18.5%. Mr. Dimon said the $1.4 billion did not represent the actual premium, but was “a good starting point.”

Mr. Dimon said First USA, of Wilmington, Del., has been trying to improve management, service, and operations. The Wachovia purchase will equal “about a year’s growth,” he said.

Competition for the Wachovia portfolio, which is about 50% MasterCard and 50% Visa, was fierce, Mr. Dimon said. “There were several people right on top of each other,” he said.

Philip G. Heasley, First USA’s chairman and chief executive officer, said his company — which bills itself as the nation’s largest Visa issuer — would not move quickly to convert the portfolio. “We are a Visa partner, but we respect the rights of consumers,” he said in a telephone interview.

Mr. Heasley said First USA’s customer satisfaction ratings took a big dip in 2000 amid accusations of unfair late fees. The protracted legal troubles led to millions of lost credit card customers, and helped prompt the resignations of two chief executive officers, Richard Vague of First USA and John McCoy of Bank One.

“We constantly measure satisfaction in the marketplace,” Mr. Heasley said. “It has improved radically over the last six to seven months.”

Under a seven-year agent banking deal, First USA will continue to market the cards in Wachovia’s name, and will pay Wachovia a fee for each new account generated. After regulatory approval of the sale, the portfolio should be converted by yearend.

First USA intends to cross-sell products to Wachovia customers. “Our product line is about three and a half times as broad as Wachovia’s product line,” Mr. Heasley said. “That is one of the big opportunities.”

He added: “Our issues have not been lack of marketing. Our issues are operational, and we have those under control.”

Ms. Wells of Wachovia said larger card issuers have efficiencies of scale that a bank Wachovia’s size cannot match. Wachovia, she said, is better off collecting ongoing revenue from new card accounts.

Mr. Dimon predicted that “a lot of banks will end up with agent relationships,” and his will be bidding for them. He said Wachovia’s portfolio of prime credit customers had been well run, and had a better average loss rate than First USA’s portfolio.

Bank One will offer jobs to some of Wachovia’s 1,400 credit card staff members, but Wachovia’s three card centers will be dissolved and the operations absorbed into Bank One.

Robert K. Hammer, chairman and chief executive officer of R.K. Hammer Investment Bankers of Thousand Oaks, Calif., tracks sales of card portfolios, and said, “This is probably the second-largest portfolio sale in recent memory, second to the AT&T Universal portfolio sold to Citibank. It also throws Bank One back into the top, and may allow them to surpass MBNA for second place among card issuers.”

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