Sweeping new regulations for credit card issuers are likely to curtail lending and crimp profits. But whose lending — and whose profits?
A widely held view is that the rule changes will create the most pain in the subprime sector — an enormous business that makes up close to a third of the portfolios of four of the top six issuers. Those four — Bank of America Corp., Capital One Financial Corp., Citigroup, and Discover Financial Services — would therefore stand to lose the most volume. American Express Co. and JPMorgan Chase & Co., on the other hand, have relatively limited exposure to borrowers with poor credit histories, and should fare better than their brethren in this analysis.