Citi Associates With the Associates Credit Card Management (10/00) Vol. 13, No. 7 p.8; Labate, John
On Sept. 6, Citigroup acquired Dallas-based First
Capital. The transaction, valued at $31.1 billion, has given the
bank a strong holding in private label and subprime cards. The
deal also signals a shift in the bank's positioning in the U.S.
card market. Citi's acquisition of Associates private-label card
receivables has pushed the bank into the top tier of U.S.
private-label issuers. As a result of the acquisition, Citi's
chairman and chief executive announced that the bank would take a
restructuring charge of between $600 million and $700 million.
Over the next two years, however, the charge will be offset by at
least $600 million in cost savings.