American Sees $1.55 Billion Boost From Citi, Barclays Card Dealsby
The accords will generate $200 million before taxes in the second half of this year, $550 million in 2017 and $800 million in 2018, the carrier said in a U.S. regulatory filing Tuesday. The pacts extend existing partnerships the carrier has with both banks and will provide “continued modest improvement” in pretax income after 2018 compared with the current deals.
American, the world’s largest airline based on passenger traffic, said it expects the dual arrangement to provide higher growth in credit-card customers than a traditional accord with a single provider. The airline also announced that all new cards tied to its AAdvantage loyalty program will carry the MasterCard brand from now on.
American rose 8.3 percent to $33.75 at 9:48 a.m. in New York, the biggest intraday gain since November 2014. Citigroup increased 2.3 percent and Barclays advanced 3.4 percent.
The two banks will issue AAdvantage co-branded credit cards starting in January.
Citi will continue offering AAdvantage cards to new customers through aa.com, mobile applications, direct mail and airport Admirals Club lounges. Barclaycard US will offer cards in airports and exclusively on flights starting in January, American said.