Barclays has agreed to sell about $1.1 billion of credit card debt in the United States to Blackstone, in a deal the British bank said would free up capacity to expand lending and reduce balance sheet risk.
Barclays said the agreement reflected its recently-announced strategy to prioritise growing lending to consumers, and would reduce the bank’s risk weighted assets by around 1 billion pounds.
Banks globally have been making greater use of credit risk transfers to shed risk from loan portfolios, Reuters has reported
, with investors sharing the risk of losses.
Blackstone’s investment has been made through insurance accounts managed by the company’s asset-based finance group.
Barclays will continue to service the accounts for a fee.
Barclays’ investment bank acted as an advisor to Blackstone on the transaction.
“During our Investor Update, we said that we would leverage strategic partnerships to execute risk transfer agreements to reduce…
