Capital One to buy HSBC credit card business

Orchard Bank , Household Bank, and HSBC credit card customers will soon be sending payments to Capital One, if a recently-announced multi-billion dollar deal is completed.

According to reports from Reuters and the Wall Street Journal, London-based HSBC had expressed intentions to focus its operations on UK consumer banking and on catering to affluent global travelers. Capital One has offered to take over HSBC’s American credit card operations. Assuming the deal closes, Capital One stands to gain a portfolio of $30 billion in credit card accounts representing the entire spectrum of consumer lending.

What happens to individual accounts

At this early stage in the commitment, neither bank has released details about what will happen to individual accounts included in HSBC’s diverse portfolio. HSBC currently issues credit cards on all four major American payment platforms: Visa, MasterCard, American Express and Discover. Capital One, however, issues only Visa and MasterCard accounts and has positioned many of its rewards credit cards directly against offerings from Discover and AmEx. Both banks handle numerous private label credit cards for retailers such as Kohl’s, Best Buy, and Neiman Marcus.

Neither bank has addressed speculation about what may happen to HSBC’s credit cards for limited credit , offered under the Household Bank and Orchard Bank brands. Capital One offers similar secured credit cards under its core brand, often offering customers the opportunity to graduate from one credit tier to another over time.

Read more: http://community.nasdaq.com/News/2011-08/capital-one-to-add-hsbc-orchard-credit-cards-to-its-wallet.aspx?storyid=90291#ixzz1UwGpI9B1