Barclays to buy Egg credit card assets

City A.M. Reporter
Barclays is to buy the British credit card assets of online bank Egg from US lender Citigroup for an undisclosed price, as part of plans to boost its retail banking business.

"The acquisition of Egg's UK credit card accounts has been priced at a significant discount to gross receivables. Based on current projections, we expect the transaction to exceed the financial return targets set out at our recent results announcement," finance director Chris Lucas said.

Barclays will integrate the Egg accounts into its Barclaycard credit card division. It added it expected that the deal would be completed during the first half of this year.

For Citigroup, the disposal of the Egg assets forms part of the American bank's programme of selling non-core businesses after Citi received a huge US government bailout during the credit crisis.

Citi acquired Egg from British insurer Prudential in 2007 for £575m and the American bank had been looking to sell Egg for some time.

Citi said the Egg sale was expected to result in an after-tax gain, which would not be material to its net income.