Capital One Financial Corp has agreed to buy HSBC Holdings Plc’s U.S. credit card business for a premium of about $2.6 billion, Bloomberg reported.
Capital One which acquired ING Direct USA in June, said the deal places an 8.75% premium on receivables from HSBC’s $30 billion of credit-card loans.
The deal which is to be completed in the second quarter of next year, allows McLean and Virginia-based Capital One to expand a balance sheet that held about $124 billion loans at the end of June.
The agreement with London-based HSBC and the acquisition of ING’s U.S. online bank will allow the lender Capital One to expand even as slowing economic growth caps demand for newer loans.
The ING buy will add about $80 billion in deposits and 7 million customers. The transaction will also boost HSBC’s consolidated core Tier 1 capital adequacy ratio by 60 basis points to 11.4% at the end of June.
Capital One has been seen as a motivated buyer for the business as it looks to bulk up on assets after the ING Direct Deal. It is a U.S.-based holding company specializing in credit cards, home loans, auto loans, bankings and savings products. It has its corporate offices in Tysons Corner, unincorporated Fairfax Country, Viriginia near McLean.
