JPMorgan Chase (JPM) struck a deal to acquire the Apple (AAPL) credit-card program from Goldman Sachs (GS), according to a media report on Wednesday, a transaction that would further bolster Chase’s already envious position in consumer credit.
The U.S.’s largest bank will become the new issuer of the tech giant’s credit card, which is one of the biggest co-branded programs with ~$20B in balances, The Wall Street Journal reported, citing people familiar with the matter.
Barring any last-minute snags, the agreement, which took more than a year to negotiate, adds to JPMorgan’s (JPM) massive presence in consumer finance, while marking the end of Goldman’s (GS) failed foray into the sector.
Goldman Sachs (GS) is expected to offload the program, with about $20B of outstanding card balances, at a more than $1B discount, the people told The WSJ. The discount reflects a high exposure to subprime borrowers and a higher-than-industry-average delinquency rate, factors which had slowed the process in finding a buyer, the newspaper had reported earlier.
JPMorgan (JPM) is planning to introduce a new Apple savings account, people familiar with the matter said. Customers with existing Apple savings accounts at Goldman (GS) can decide whether to move their account to JPMorgan or stay with Goldman, they told the WSJ.
JPMorgan Chase (JPM) and Apple (AAPL) stocks were little changed in after-hours trading, and Goldman Sachs (GS) edged up 0.1%, and