Lloyds Banking Group completes £ 1.9bn MBNA acquisition
Lloyds Banking Group has completed its acquisition of consumer credit card business MB NA from Bank of America after regulators rubber- stamped the £ 1.9 billion deal.
The banking giant said MBNA, which holds assets of £7 bn, would deliver strong financial returns and bolster its position in the UK prime credit card market.
Antonio Hor ta-O so rio, group chief executive of Lloyds, said MB NA was a “good fit” with the bank’s credit card business.
He added :“The acqui sition, which is funded through strong internal capital generation,increases our participation in the UK prime credit card market, where we were underrepresented, and strengthens our position as a UK-focused retail and commercial bank .”
The deal will provide a £ 650 million- a- year boost to Lloyds’ group revenues, while enhancingthenet interest margin by around ten basis points per year.
Lloyds aims to deliver cost savings of around £100m per year within two years at MBNA, representing 30 p er cent of the unit’s cost base.
The announcement comes weeks after Lloyds was fully privatised, with the UK government selling its final stake in the lender.
MB NA will be kept as a challengerbrand and will help Lloyds strengthen its credit cards market share from 15 per cent to 26 per cent.