Bank of America Corp. on Dec. 21 sold $700 million in credit card assets to U.S. Bancorp in the struggling Charlotte, N.C., company’s latest effort to slim down.
U.S. Bancorp says its Elan Financial Services unit bought the credit card assets of 28 financial institutions from BofA’s FIA Card Services N.A. The portfolio includes cards issued on behalf of investment advisory firm Edward Jones.
The financial terms of the deal were not disclosed. Customers can continue using their existing cards until Elan issues new ones in 2012.
"This portfolio of financial institutions represents a significant opportunity for Elan," Pamela Joseph, vice chairman and head of U.S. Bancorp Payment Services, said in a press release. "They are highly regarded financial-service partners to millions of Americans, and we share their commitment to adding high quality financial services for their clients that can help them achieve their goals."
U.S. Bancorp previously has done similar credit card deals with other beleaguered banks. In 2009, the Minneapolis-based company purchased three credit card portfolios totaling $1.3 billion in managed assets from Citi Holdings, Citigroup Inc.’s repository for unwanted businesses. At that time Citigroup was looking to sell or wind down many of its noncore credit card portfolios, but it has since reincorporated that unit into its core business.
BofA has made several deals recently to shrink its cards business as it works to focus on its main banking businesses. The company sold its $8.6 billion Canadian credit card portfolio to Toronto-Dominion Bank and in August reached an agreement to sell about $200 million in card balances to Sovereign Bank.
