HSBC has agreed the sale of its US card and retail services business to Capital One for a premium of approximately $2.6 billion.
Capital One is paying an 8.75% premium on receivables from the $30.4 billion of credit card loans. HSBC will book a post-tax gain of $2.4 billion.
The buyer will take on HSBC's monoline US credit card and private label business, the products of which are offered throughout the country through strategic affinity and co-branding, merchant relationships, direct mail and the Internet.
In 2010 the unit made an unaudited post-tax profit of $1.3 billion, up from $400 million the previous year.
All HSBC staff will be offered the opportunity to join Capital One when the deal closes, subject to government and regulatory approval.
The sale is part of a major cost cutting programme for HSBC and follows the recent disposal of 195 US branches to First Niagara Financial for about $1 billion in cash.
Stuart Gulliver, CEO, HSBC, says: "This transaction continues the execution of the strategy we announced at our Investor Day on 11 May to focus our US business on the international needs of customers in Commercial Banking, Global Banking & Markets, Retail Banking and Wealth Management and onshore Global Private Banking."
For Capital One, the deal marks its second swoop in a couple of months to pick up the unwanted assets of European banks, following the $9 billion acquisition of ING's American direct banking arm.