Bank of America Agrees to Buy MBNA for $35 Billion

[LynneSin]

http://quote.bloomberg.com/apps/news?pid=10000006&sid=aaRuCi2aeCzA&refer=home

June 30 (Bloomberg) -- Bank of America Corp., the second- largest U.S. bank by assets, agreed to buy MBNA Corp. for about $35 billion in stock and cash to challenge Citigroup Inc. and JPMorgan Chase & Co. in credit cards.

The Charlotte, North Carolina-based bank plans to cut 6,000 jobs after the purchase, it said in a PR Newswire release today. Bank of America will swap 0.5009 share and $4.125 for each share of Wilmington, Delaware-based MBNA. That values MBNA at $27.50 a share, Bank of America said.

The deal reshapes the U.S. credit card industry by taking out the largest non-bank issuer. It also vaults Bank of America over American Express Co. in one of the fastest-growing U.S. financial-services markets.

``This will be the biggest deal in the credit-card industry for the foreseeable future, unless American Express is acquired,'' said David Robertson, president of the Nilson Report, a card industry publication.

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Big thing with this merger is that MBNA has an American Express portfolio but they've been bleeding money left and right

[truthisfreedom]

1. what exactly does MBNA stand for?

micro computer center issues cards under this name.

[LynneSin]

2. Maryland Bank North America

:D

[still_one]

3. well, I just got rid of my MBNA card after I found out that

they were the biggest bush supporter, and were heavily involved in the recent bankrupcy legislation

now it looks as though I will have to get rid of my Bank Of America account

we are becoming a plantation society

[LynneSin]

4. Bank of America is about 50/50

2006
Bank of America: 45%Dem/55%Rep
http://www.opensecrets.org/industries/contrib.asp?Ind=F03&cycle=2006 45

2004
Bank of America: 47%Dem/52%Rep
http://www.opensecrets.org/industries/contrib.asp?Ind=F03&Cycle=2004


2006
MBNA: 15%Dem/85%Rep
http://www.opensecrets.org/industries/contrib.asp?cycle=2006&ind=F06

2004
MBNA: 26%Dem/74%Rep
http://www.opensecrets.org/industries/contrib.asp?Ind=F06&Cycle=2004


Remember it is Bank of America that bought MBNA so I'm sure they'll be keeping their CEO (who btw, is a repuke from NC).

But the big concern is how their PACs give out money

Here's a breakdown of BoA PACs:
2006: http://www.opensecrets.org/pacs/lookup2.asp?strID=C00043489&cycle=2006
2004: http://www.opensecrets.org/pacs/lookup2.asp?strid=C00043489&cycle=2004

MBNA PACs
2006: http://www.opensecrets.org/pacs/lookup2.asp?strID=C00252866&cycle=2006
2004: http://www.opensecrets.org/pacs/lookup2.asp?strid=C00252866&cycle=2004

Definetly both will favor repukes, but MBNA is definately the worst of the 2 (BoA is about 40/60, MBNA is 25/75)

[still_one]

6. I have another concern about these mega mergers

it creates monopolies and a plantation society which was never the intent of those that founded this country

[sendero]

10. Me too..

.... we cancelled both our joint card and my wife had a personal card.

And she told them exactly why when she called to cancel :)

BofA is a sorry assed company, their fee structure is unbelievable. A marriage between them an MBNA seems appropriate. And appropriate to avoid.

[Julius Civitatus]

15. "We are becoming a plantation society" --- Indeed!

Very true statement.

I wonder when will they bring back "debtor prisons," because it's the only thing the credit card industry didn't get with that horrible bill.

:hi:

[MaineDem]

5. There are many MBNA jobs in Maine

I detest MBNA but I'm afraid the job cuts will impact the economy in this state. We're already hurting and our Democratic Governor is taking a lot of heat because of it.

And what's with BoA? They're taking over more and more lately.


Edited for spelling.

[Gormy Cuss]

16. Watch those jobs disappear

BofA will consolidate call centers. If the MBNA operations in Maine are cheaper, they may survive and grow for a few years but the acquistion in the Northeast have been substantial and I'm guessing between the FleetBoston operations and MBNA there is considerably redundancy in the region.

[Nickster]

7. So does BoA get Biden in the deal too??

[DiverDave]

8. Biden sold his soul to MBNA, long ago

eom

[LynneSin]

9. He lives in Delaware - all of them have offices in DE Banks

Even Castle and Carper have their offices at a competitor bank

[cyberpj]

11. Bank of America agrees to buy MBNA

Bank of America agrees to buy MBNA
Bloomberg News

FRIDAY, JULY 1, 2005

NEW YORK Bank of America, the second-largest U.S. bank by assets, agreed Thursday to buy MBNA for about $35 billion in stock, challenging Citigroup, the market leader, and J.P. Morgan Chase in the credit card field.

Bank of America, based in Charlotte, North Carolina, said it planned to cut 6,000 jobs after the purchase.

The deal reshapes the U.S. credit card industry by taking out the largest nonbank issuer and by vaulting Bank of America ahead of American Express in one of the fastest-growing U.S. financial-services markets.

"This will be the biggest deal in the credit-card industry for the foreseeable future, unless American Express is acquired," said David Robertson, president of The Nilson Report, a card industry publication.

(cont'd...)
http://www.iht.com/articles/2005/06/30/business/bofa.php

[cyberpj]

12. This may have a huge effect on Delaware, they're our largest employer.

I wonder if the 6,000 jobs will be all ours?

[losdiablosgato]

13. I figure Delaware will take a big hit from this.

[2Design]

14. two banks to stay away from anyway

they are scammers - after the little guy and raising interest on cards without reason -

[Roland99]

17. 6,000 more confident consumers about to flood the economy with money

Oh wait....