Capital One to buy HSBC’s U.S. credit card unit
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Capital One Financial Corp. said Wednesday that it would buy the U.S. credit card division of London-based HSBC Holdings for $32.7 billion as it attempts to expand its own credit card franchise.
HSBC, as part of a strategic narrowing of its retail business, will pass off more than $30 billion of credit card loans and store-branded credit cards to Capital One for a $2.6 billion premium.
The deal is expected to close in the second quarter of 2012. At least in the near future, HSBC customers should be able to use their cards as usual without any service changes.
HSBC has been in a shedding phase, recently selling 195 of its U.S. bank branches and planning to cut 30,000 employees worldwide over the next few years.
Meanwhile, Capital One is on a buying tear, saying in June that it would spend $9 billion snapping up Dutch company ING Group’s American online banking operations.
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