Ally Financial recently made waves in the financial industry by announcing plans to exit the credit card business. This strategic decision involves selling their credit card portfolio to CardWorks, Inc. and its subsidiary, Merrick Bank. As of December 31, 2024, the portfolio consisted of $2.3 billion in credit card receivables and 1.3 million active cardholders.
According to Ally’s CEO, Michael Rhodes, this move aligns with their broader strategy to streamline operations and focus on core businesses. “We are proud of the results achieved over the past three years and are pleased with the terms of this agreement, allowing for continued growth with CardWorks,” Rhodes said.
For CardWorks, this acquisition enhances their position as a leading credit card issuer. CEO Dan Pillemer expressed excitement about the deal, noting that it aligns perfectly with their business model. The transaction is expected to close later this year, pending customary closing conditions.
Sources:
https://www.bankingdive.com/news/ally-to-sell-credit-card-business-to-cardworks/737983/
https://finance.yahoo.com/news/ally-drops-credit-card-business-133535659.html
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