First USA purchase makes it No. 2 card

Maryland Watch

September 04, 1998

Banc One Corp. said yesterday that its First USA credit card unit bought Chevy Chase Bank's credit card business for an undisclosed sum, making it the No. 2 U.S. credit card company.

Columbus, Ohio-based Banc One said First USA bought $4.9 billion of card loans and will hire Chevy Chase's 1,300 credit card employees and take over the bank's credit card facilities in Frederick. The deal will give First USA about $46.5 billion in card loans, placing it past MBNA Corp. and behind No. 1 Citicorp.

First USA will offer Chevy Chase's customers cards under the Chevy Chase name. Typically when a card company issues cards under a bank's name, the bank receives a percentage of the revenue generated by those cards. A First USA spokesman declined to comment on terms of the transaction.

First USA also will assume the bank's card partnership program with Giant Food stores. First USA has about 43 million outstanding credit cards.

Chevy Chase Bank, a closely held company with more than $6.6 billion in assets, is the largest bank based in the Washington metropolitan area.

Pub Date: 9/04/98

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