Capital One Financial Corp. says it will buy the U.S. credit card arm of Britain’s HSBC for a premium of about $2.6 billion as a way to expand its domestic credit card business. “Adding the HSBC card business to our own will enhance our credit card franchise and accelerate our achievement of a leadership position in retail card partnerships,” Capital One Chairman and CEO Richard Fairbank says. The acquisition includes the HSBC unit’s approximately $30 billion credit card portfolio. HSBC announced in May that it was exploring a possible sale of the business, which includes its MasterCard, Visa, private label and other credit card operations. The deal does not include HSBC Bank USA’s $1.1 billion credit card program.
The sale of the U.S. credit card division comes a little more than a week after HSBC announced it would sell almost half its retail branches in the United States. HSBC and Capital One say they expect no immediate changes to the credit card programs and operations. HSBC customers will see no near-term service changes and should be able to use their credit cards as normal. The acquisition is expected to close in the second quarter of 2012.
