Canadian major bank CIBC completes new acquisition of MasterCard portfolio

The Canadian Imperial Bank of Commerce (CIBC), one of the country's five major banks, announced on Wednesday that it has completed an acquisition of an approximately two billion Canadian dollars (1.92 billion U.S. dollars credit card portfolio from Citigroup's Canadian MasterCard business.

This has made CIBC the largest dual issuer of Visa and MasterCard credit cards in Canada.

"This acquisition is consistent with CIBC's strategy to support the growth of our core Canadian franchise," said Gerry McCaughey, President and CEO of CIBC, adding that it represents an important addition to the client base of CIBC.

CIBC had more than 14 billion Canadian dollars in outstanding credit card balances prior to the addition of the MasterCard portfolio, which is expected to be immediately accretive to CIBC's earnings.

"This acquisition will allow us to leverage our strong presence and capabilities in the credit card business," said Sonia Baxendale, President of CIBC Retail Markets.

Under terms of the transaction, prior to closing, non- performing accounts were removed from the acquired portfolio and from the securitized pool relating to Broadway Credit Card Trust, which has securitized certain Citibank MasterCard receivables.

Statistics show that CIBC provides financial products and services to almost 11 million individual, small business, commercial, corporate and institutional clients in Canada and around the world. (1 U.S. dollar = 1.06 Canadian dollars)

Source:Xinhua