Barclays move towards US credit card market

British banking group Barclays today took the first steps towards establishing its Barclaycard operation in the United States credit card market.

The move comes after Barclays said it had agreed to acquire Juniper Financial Corporation for $293m (€238m) from US bank CIBC.

Juniper, which has 700,000 accounts and total lending of $1.4bn (€1.1bn), provides credit cards and services to US companies and non-profit agencies.

The majority of its credit cards are given the brands of its customers, which include Best Western, Gulf Petroleum and Midwest Airlines.

Barclays said the business would be incorporated within its overseas division of Barclaycard with the UK brand possibly set to be introduced into the US market in the future.

The bank vowed to inject investment into Juniper and expected it to make a “significant contribution” to operating profits at Barclaycard within three years.

The deal, which is subject to clearance by US regulators, also puts Barclaycard International on track to match the profits of the UK credit card business within ten years.

Gary Hoffman, chief executive of Barclaycard, said: “We believe this acquisition will provide us with low-risk entry to the largest credit card market in the world.”

The acquisition of Juniper, which will not require extra borrowing, gives Barclays a third business in the US.

It has an investment banking business trading as Barclays Capital out of New York in addition to asset management arm Barclays Global Investors, which has its headquarters in San Francisco.