Magazine article American Banker

First National Plans New Cobranded Cards after B of A Deal

Magazine article American Banker

First National Plans New Cobranded Cards after B of A Deal

Article excerpt

Byline: Kate Fitzgerald

Interest in cobranded cards cooled when consumers' financial losses soared, but nobody told First National Bank of Omaha.

The card issuer next year will launch three cobranded credit card programs, Steve Eulie, the president of First National's First BankCard credit card division, tells PaymentsSource. His comments followed First National's announcement that it has bought $300 million of card receivables from Bank of America Corp.

First National last year became one of three issuers to offer credit cards supported by all four of the major network brands, and on Wednesday it announced the purchase of 10 institutions' credit card portfolios from B of A, which served as the banks' agent issuer.

The deal includes B of A's $100 million former Chrysler Financial card receivables; the credit card portfolio of New York Community Bank, which operates 1,000 branches; and card portfolios associated with Apple Bank, Chemical Bank, First Bank, First Farmers and Merchants and Old National Bank. The deals amount to $285 million of total receivables, according to a press release.

B of A earlier this year announced a plan to divest assets, including credit card portfolios from many of its bankcard agent relationships.

Separately on Tuesday, U.S. Bancorp's Elan said it has acquired $700 million of credit card assets from B of A.

First National began issuing Chrysler cobranded cards in April through a new relationship with Chrysler Group LLC. However, B of A continued to own the receivables from the former operation until this deal was completed, Eulie says.

Also, First National in April launched a cobranded Visa card with The Grand Ole Opry, Eulie notes.

First National's moves make good on its promise last year to continue to expand in the bankcard market and to go after new cobranded card deals.

"During the last couple of years, because of economic pressure and other factors, it looked like private-label retail and general-purpose cobranded cards were falling out of favor," Eulie says. …

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