Regions Bank announced the completion of a deal this week that will allow them to acquire a portfolio of its own branded credit cards valued at $1 billion from FIA, reports Forbes.com. The deal was signed on June 30 between Regions Bank, a unit of Regions Financial Corp., and FIA Card Services, a subsidiary of Bank of America.
Terms of the transaction itself have not been released to the public, but Regions has announced that it has purchased a total of 500,000 consumer and 40,000 business credit card accounts from FIA, adding up to a portfolio of roughly $1 billion in Regions-branded credit card accounts.
Regions is a major bank in the southern and Midwest United States, with 1,800 branches located across 16 states, while FIA Card Services is a relatively new financial institution created in 2006 by the merger of the former MBNA America Bank with a collection of Bank of America assets.
Regions says it acquired these accounts from FIA with the intention of diversifying and balancing its loan portfolios. John Owen, senior executive vice president for Regions, was quoted as emphasizing the financial and investment incentives for Regions and adding, "We plan to grow this business as part of an expanding suite of financial solutions to better serve our customers."
Customers who currently have Regions accounts, from personal to small business credit cards, will experience no disruption in cardholder services, since the deal includes an agreement that FIA will continue to process bills and payments until they can be taken over by Regions in mid-2012.