Bank of America exits card business
Bank of America owns MBNA in Ireland and between them its British and Irish card businesses have $19 billion (€13bn) in credit card loans and has about 1,000 employees in Ireland.
Enterprise Minister Richard Bruton said he was in contact with bank representatives to discuss the decision and the implications for their Carrick-on-Shannon facility.
He said the IDA will market the business through its Global Network, which has had a number of successes in finding buyers in sectors throughout the country.
Bank of America plans to sell its credit card business in Canada to TD Bank Group and will exit the rest of its international credit card business. The bank also said it would exit its Ireland and Britain card businesses. It has not made a decision on the future of those businesses, which it may wind down or sell, a spokesman said.
TD Bank’s agreement with Bank of America, the largest US bank by assets, covers an $8.6bn card portfolio, according to a Bank of America statement.
TD Group said it will pick up 1.8 million active card accounts from the deal and would pay a “modest premium” for the card receivables.
The move effectively ends Bank of America’s consumer banking operations overseas, and comes as it seeks ways to bulk up its capital cushion.
The bank is fighting lawsuits and credit problems related to its ill-fated acquisition of home mortgage lender Countrywide Financial three years ago as the US housing bubble burst.
The bank has lost more than $22bn in its consumer mortgage division in the last four quarters.
The sale was not a reaction to analyst estimates over the last week that the bank would need to raise capital to absorb those losses, said Bank of America spokesman Jerry Dubrowski.
Bank of America said the deal would have a positive effect on its capital levels. It is expected to close in the fourth quarter.
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