MBNA America Bank expects to have a big summer as it continues to gobble up credit-card collateral through acquisitions and marketing agreements, and quietly builds its home equity loan program.
The Wilmington, Del.-based issuer is expected to price a large card transaction later this month, while also planning to issue bonds from its new home equity portfolio.
The HEL program was launched as a commercial paper vehicle earlier this year, and is slated for the term market when origination volumes rise to sufficient levels.
Vernon Wright, chief financial officer for the bank and its holding company MBNA Corp., said the company has principally been utilizing a third-party multiseller conduit to house its home equity collateral since launching the program.
"We haven't done it as a standalone asset-backed security to date," Wright said. "We have not seen the volume yet to do that."
Big Card Buyers, Web-Savvy
The company's card purchases and joint ventures continue apace, most recently with Internet-based EarthWeb and Durham, N.C.-based CCB Financial Corp.
MBNA expects to purchase $150 million from CCB affiliate banks in the Southeast and will allow CCB to issue credit card products to its customers using the CCB name through MBNA.
The credit-card giant also signed an affinity credit card alliance with EarthWeb, which sells business supplies through its Web site. The deal was marketed by the companies as "one of the first affinity credit card programs in the business-to-business Internet space."
MBNA will issue the affinity cards and target technology professionals. EarthWeb said it expects to accrue "seven figures in revenue" over the term of the agreement from MBNA advertising, royalties and other payments related to customer use of the cards.
Wright called the recent acquisitions of card collateral part of MBNA's "normal growth."
"We generally sign up 300 to 400 organizations a year," he said about the company's many credit card relationships. Most expect a deal in the $800 million range to hit sometime this month with Merrill Lynch & Co. as a likely lead. - SK