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(Alliance News) - Bank of Ireland Group PLC said Friday it has sold its UK credit card portfolio for about GBP530 million to private equity firm Centerbridge Partners Europe LLP and Norwegian startup lender Jaja Finance Ltd.
Bank of Ireland said it is selling the portfolio following a review of its UK business.
The portfolio includes the lender's consumer credit cards under its own brand and those of the Post Office Ltd and motoring association AA PLC. As part of the deal, Jaja will issue the AA credit card as well as Bank of Ireland credit cards in the UK.
At the end of 2018, Bank of Ireland's consumer credit portfolio in the UK was about GBP545 million. In 2018, the business contributed GBP35 million to total income and had operating expenses of GBP36 million.
The lender reported group net interest income of EUR2.15 billion.
Bank of Ireland expects the sale of the portfolio to generate a roughly 70 basis point improvement in the UK business' return on tangible equity and add about 10 basis points to the group CET1 ratio.
The bank's fully loaded CET1 ratio ended 2018 at 13.4%.
Bank of Ireland said the proceeds will be used for general corporate purposes.
Shares in the lender were down 3.1% in London on Friday at EUR4.55 each.