February 20, 2007

•  

  
  NEWS: Barclays to Sell Sub-Prime Card Biz?

  Barclaycard, Britain's biggest credit card issuer, is rumored to be considering selling two of its "sub-prime" credit card businesses. The news comes hot on the heels of a much-reported wave of bad debt current assailing the British banks, as overwhelmed consumers default ¬en masse on loans and credit cards.
  
  The two card businesses in question are Monument and Clydesdale Financial Services. Monument deals primarily with offering cards to those with poor credit, while Clydesdale is in the business of offering store cards with high interest rates for retailers like Bang & Olufsen. Whispers from industry experts about the likelihood of either or both properties being put up for sale reached a crescendo this past week, when the 2006 fiscal year results were reported, and Barclays (along with every other major British lender) took dramatic losses in terms of writing off bad debt.
  
  Monument and Clydesdale make up only a small amount of Barclays' huge portfolio (£24 billion, or $60 billion US), but –obviously- account for the riskiest customers in Barclays' stable. In light of the poor news from the past year, Barclays –which has recently undergone executive turnover- is expected to turn away from the bad-credit card/loan division of its services, and turn more attention to wooing more stable, desirable customers.
  
  
     Back to News Main Page