Could MBNA Be A Takeover Candidate?
ARLINGTON, Va. - While most credit union executives know MBNA best for its role in the credit union space, it is worth noting that the company does a lot more card business than just with credit unions - and some of the overall card activity may lead the firm into being taken over. BusinessWeek in its June 20 issue has a story which speculates that times have gotten hard enough for the mononline card issuer that takeover become a real possibility. The magazine reported that the card giant's stock price has fallen by 25% in its share price this year, to around $21, and that speculation about a buyout has grown after Washington Mutual's June 6 deal to buy card issuer Providian Financial for $6.5 billion. The article also reported that MBNA's total loans to customers fell to $116.6 billion in the first quarter, down $1 billion from the year before. And the company had to take a write-off of $206.6 million, partly because of the rapid paydown of balances. BusinessWeek also quoted MBNA CEO Bruce Hammonds to the effect that MBNA is not for sale and detailed some of he company's attempts to lift its stock price.