Bank of America's decision to buy MBNA Corp, the world's largest independent credit card lender for $35bn has been labelled "the perfect fit" by a number of analysts, says Jonathan Stempel on Reuters.co.uk. Not only will the combination create one of the world's biggest credit card issuers, the deal should lead to cost cutting of some $850m after-tax, to be realised by 2007. Moreover, rivals such as Citigroup and JPMorgan have increasingly upped their stakes in the credit card business, so BofA's acquisition is certainly not inappropriate.
The deal comes only a year after Bank of America's takeover of FleetBoston for some $47bn. Back then shareholders "vilified it", says Rob Cox on Breakingviews.com, only to be proven wrong as the deal actually lived up to its promises. And the deal with MBNA could well follow in its footsteps.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
-
Thousands of Brits switch to Nationwide, Monzo and HSBC – which banks are least popular?As current account bank switches reach a record high, we look at the most and least popular banks and building societies among Brits. Is it worth switching?
-
Are these FTSE 100 pharmaceutical stocks worth a look?Pharmaceutical stocks are some of the biggest in the FTSE 100. The sector is threatened by tariffs, but some have posted encouraging results regardless.
