In a move that could cost Banco Santander Central Hispano at least GBP289 million ($507 million), the Spanish bank is looking to purchase the credit card operations that MBNA Corp. bought from Santander unit Abbey National PLC's four years ago.
The Spanish bank has issued 15 million cards globally and is thought to be expanding Abbey's business by severing its ties with MBNA, the U.S. credit card operator, market sources said. Abbey sells credit cards that are both designed and produced by MBNA in return for a commission on each sale. According to market reports, if Santander intends to move ahead with expanding the Abbey business, it would have to buy back the credit card assets from MBNA. "I understand that Abbey is looking to buy back some' of the MBNA business - I don't know how much, although I can't imagine that this would have a significant impact on a lender the size of MBNA," said one source at Morgan Stanley.