Capital One has agreed to buy HSBC’s US credit
card business for $32.7 billion. The sale includes HSBC’s
MasterCard, Visa, private label and other credit card
operations.
The sale came after HSBC announced that a
strategic business was underway where the business has shown a
strong performance throughout the financial cycle but is not
aligned with HSBC Group strategy.
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As reported in
Retail Banker International, HSBC Group CEO Stuart Gulliver
announced his intention to divest the bank’s US credit card
portfolio in June.
He said: “This transaction continues the
execution of the strategy we announced at our Investor Day on 11
May to focus our US business on the international needs of
customers in Commercial Banking, Global Banking & Markets,
Retail Banking and Wealth Management and onshore Global Private
Banking.
“Although dilutive in the short term, this
transaction will reduce group risk-weighted assets by up to $40bn
which, together with an estimated post-tax gain on sale of $2.4bn,
will allow capital to be redeployed over time.”
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