Capital One Acquires GE Capital’s Hudson’s Bay Company Card Business
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Toronto, ON. (November 9, 2010) - Capital One Canada and GE Capital Retail Finance, the North American consumer lending unit of General Electric Company (NYSE:GE), today announced a definitive agreement under which Capital One Canada will acquire and service GE Capital’s Hudson’s Bay Company credit card portfolio and related assets, with outstanding receivables of approximately $1.3 billion.
“Hudson’s Bay Company’s storied and trusted brand makes it an attractive partner for Capital One as we seek to expand our suite of credit card products in Canada,” said Rob Livingston, Capital One Canada’s President. “This is a compelling opportunity for Capital One to increase our presence in the Canadian market. We will leverage our unparalleled underwriting and analytics to help enhance and drive growth within the Hudson’s Bay Company credit card portfolio. We also look forward to providing exceptional value and service to loyal Hudson’s Bay Company cardholders.”
Capital One Canada is an industry leader in analytical expertise and credit risk management, and will apply both capabilities towards strengthening and growing the Hudson’s Bay Company credit and loyalty portfolio. Capital One and Hudson’s Bay Company will partner to provide compelling offers and innovative services to the millions of passionate collectors of Hudson’s Bay Company rewards.
The acquisition will include the transfer of approximately 400 GE employees directly involved in the Hudson’s Bay Company’s financial services business to Capital One. These employees will continue to work on the Hudson’s Bay Company credit card portfolio at locations in Toronto and Montreal.
“This transaction, which involves GE’s only solely Canadian retail card portfolio, allows us to exit a non-strategic market for Retail Finance. Our business is performing extremely well and will continue to focus its efforts on growing in the US market, where we have relationships with over two-dozen leading US-based retailers, many of which have been extended recently with new, long-term agreements,” said Margaret Keane, president and CEO of GE Capital, Retail Consumer Finance.
The transaction, which was approved by the board of directors of Capital One and GE Capital is subject to customary regulatory approvals and notifications and is expected to close in the first quarter of 2011.
Part of GE Capital and headquartered in Stamford, Connecticut, GE Capital Retail Consumer Finance offers customized private label credit card programs to more than two dozen partners and has nearly $30 billion in assets and over 40 million account holders. Canada remains an important market for GE Capital. It is one of the largest financiers in Canada after the 5 banks and helps finance over 60,000 small to large sized businesses across the country. GE Canada is the 3rd largest market for GE outside the US and continues to grow in Canada.
Forward looking statements
The company cautions that its current expectations in this release dated November 9, 2010, and the company's plans, objectives, expectations, and intentions, are forward-looking statements. Actual results could differ materially from current expectations due to a number of factors, including: general economic conditions in the U.S., Canada or the company's local markets, including conditions affecting consumer income, confidence, spending, and savings which may affect consumer bankruptcies, defaults, charge-offs, deposit activity, and interest rates; changes in the labour and employment market; changes in the credit environment; the company's ability to execute on its strategic and operational plans; competition from providers of products and services that compete with the company's businesses; increases or decreases in the company's aggregate accounts and balances, or the growth rate and/or composition thereof; changes in the reputation of or expectations regarding the financial services industry or the company with respect to practices, products, or financial condition; financial, legal, regulatory (including the impact of the Dodd-Frank Act and the regulations to be promulgated thereunder), tax or accounting changes or actions, including with respect to any litigation matter involving the company; and the success of the company's marketing efforts in attracting or retaining customers. A discussion of these and other factors can be found in the company's annual report and other reports filed with the Securities and Exchange Commission, including, but not limited to, the company's report on Form 10-K for the fiscal year ended December 31, 2009 as well as its most recent Quarterly Report on Form 10-Q.
About Capital One
Located in Toronto, Ontario, Capital One has offered Canadian consumers a range of competitive MasterCardcredit cards since 1996, when the company first introduced the Platinum MasterCardin Canada. Capital One Canada is a division of Capital One Bank, a subsidiary of Capital One Financial Corporation of McLean, Virginia (NYSE: COF).
Contact: Laurel Ostfield 416-549-2753
Additional Media Contacts:
Stephen White, GE Capital Retail Finance
Kim Warburton, GE Canada