Credit Card King Eyes Comeback as 100,000 Point Bonuses Return
(Bloomberg) -- The king of cards is eyeing a comeback.
Citigroup Inc. -- the world’s largest credit-card issuer -- is looking to jump start efforts to acquire new cardholders after the pandemic caused it to curtail such activities last year.
“Coming into this we wanted to be very thoughtful about how we managed our risk and we tightened risk criteria in order to ensure that we could manage responsibly through this pandemic,” Citigroup Chief Financial Officer Mark Mason said on a conference call with analysts. “Now as we sit here and see all the signs of recovery that you’ve heard us mention, it’s about our responsible reopening.”
Rivals Capital One Financial Corp. and American Express Co. already kick-started their efforts to capture new cardholders late last year. Capital One is now offering a 100,000-point sign-up bonus for new Venture Rewards card customers, while AmEx is dangling as much as 125,000 membership rewards points to select applicants of its Platinum card.
Citigroup’s card business was battered by the pandemic, which sent unemployment soaring and shuttered businesses across the country. While losses have remained near historic lows, card loans in its U.S. business have plummeted 14% in the last year and the firm ended the first quarter with 5.8 million fewer open accounts than it had a year ago.
“The good news is that we’re seeing the recovery in spend,” Mason said. “We are now focused on loan and revenue recovery through driving spend activity, reentering the market for new account acquisitions and investing in lending capabilities and new value propositions.”
JPMorgan Chase & Co., which has the largest card portfolio in the U.S., said this week that it would begin spending more on the marketing of its products in the second half of the year, forcing the bank to boost its guidance for annual expenses. At Bank of America Corp., the firm said it continued to see applications for its cards climb in the first three months of the year.
“Card applications and mortgage originations continue to increase in each of the last three quarters,” Bank of America Chief Executive Officer Brian Moynihan said in a conference call discussing his bank’s earnings. “Pipelines continue to build but line usage remains low.”
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