Barclays Buys $3.8 Billion Gap Credit Card Portfolio

(Bloomberg) -- Barclays Plc acquired a $3.8 billion portfolio of credit cards from retailer Gap Inc., giving it a new route to American consumers. 

The British bank will issue co-branded and private label credit cards in the U.S. to Gap customers from the second quarter next year, Barclays said in a statement on Friday. 

While Chief Executive Officer Jes Staley has made the investment bank his focus for growth, he has also spoken of expanding more into American credit cards. Barclays has previously struck deals with brands such as Uber Technologies Inc. and American Airlines Group Inc.

The bank’s consumer, cards and payments unit had a tough pandemic as lockdowns squashed consumer spending in the U.S. and its home market, but posted a profit before tax of 288 million pounds ($395 million) in the second quarter. 

The deal means that Barclays’s CET1 ratio, a measure of capital strength, will be reduced by 20 basis points, the bank said in the statement. Its ratio stood at 15.1% at the end of June.

Gap previously used Synchrony Financial as its credit-card issuer. Dow Jones reported that it was switching to Barclays in April. 

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