Bank of America to double cards business with MBNA acquisition

New York: Bank of America Corp, the second-largest US bank, will emerge one of the world's largest card issuers of credit cards with its acquisition of MBNA Corp. BankAm had announced its decision on Tuesday this week to buy MBNA Corp, the biggest independent credit card lender for $35 billion.

The stock-and-cash transaction, which offered a premium of 30.6 per cent for MBNA, will more than double BankAm's card business, giving it 40 million cardholders and $143 billion in balances.

This, says BankAm, will make it the world's largest issuer of Visa and MasterCard credit, debit and prepaid cards, and the leading rival in cards to Citigroup Inc. and JPMorgan Chase & Co. and bigger than American Express Co.

The MBNA acquisition is BankAm chief executive Kenneth Lewis' second major acquisition, following the $48 billion purchase of Fleet Boston Financial Corp in April 2004.