Nordstrom Said to Gauge Banks Interest in Its Credit Cards
Nordstrom Inc. (JWN), which is exploring a sale of its store-branded credit cards, has begun reaching out to potential buyers including Capital One Financial Corp. (COF) and Toronto-Dominion Bank to gauge their interest, according to people familiar with the matter.
The retailer has also approached Citigroup Inc. (C) and JPMorgan Chase & Co., the people said, asking not to be identified because the matter is not public. Nordstrom is informally canvassing buyers of the $2 billion portfolio of credit card receivables and hasn’t yet set a date to solicit initial offers, said one of the people.
Nordstrom, based in Seattle said on May 15 it was working with Goldman Sachs Group Inc. (GS) and Guggenheim Partners LLC to find a “financial partner” for its credit cards in the next 12 to 18 months. It follows Macy’s Inc. (M) and Target Corp. (TGT) in getting rid of store-branded card portfolios, which banks are interested in buying.
Dan Evans, a spokesman for Nordstrom, declined in an e-mail to elaborate on the company’s comments on May 15. Representatives for Capital One and JPMorgan didn’t immediately respond to requests for comment, while spokesmen for Citigroup, Toronto-Dominion and Goldman Sachs declined to comment.
Nordstrom’s portfolio could fetch at least $2 billion, or a price equal to the value of its outstanding receivables, one person said. It plans to reach out to other top issuers of credit cards and so-called private-label cards, one person said. Private-label cards are cards that a lender manages on behalf of a retailer or manufacturer.
Toronto-Dominion last year bought Target’s $5.9 billion credit card portfolio, while Capital One bought HSBC Holdings Plc’s store-branded cards in 2012.
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