Capital One Gets HSBC Credit Cards: What’s Next for Cardholders

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NEW YORK (MainStreet) — Capital One (Stock Quote:  COF) announced Tuesday that it has purchased the domestic arm of HSBC’s (Stock Quote: HBC) credit card business, a move that will add approximately $30 billion to its credit card portfolio.

Should existing HSBC cardholders expect the terms and conditions of their credit card contracts to be affected? According to Capital One, the acquisition is not expected to be completed until the second quarter of 2012 and, as such, there aren’t any changes currently on the horizon.

“It's business as usual for HSBC's customers,” an HSBC spokesperson told MainStreet. “They should continue to use their credit cards as they normally would.”

Capital One went on to say that adding the HSBC card business is meant to enhance Capital One’s credit card franchise and add to its retail card partnerships.  

“We are very excited to work with our new retail and co-branded partners, as well as the HSBC associates who are joining Capital One,” the spokesperson said. “Together, we look forward to providing exceptional value and service to our new customers.”

Whether or not this means that HSBC customers will ultimately be issued a new credit card remains to be seen. However, Beverly Harzog, a credit card expert with Credit.com, said that affected consumers shouldn’t be overly concerned about the acquisition as it makes a lot of sense for both companies.   

“[The two issuers] really seem like a good fit because there’s overlap in their target market,” Harzog said. She explained that Capital One traditionally has tailored its products to people with good to fair credit while HSBC targets consumers with fair to poor credit profiles. Case in point, HSBC’s Orchard Bank Classic Master Card, which Harzog calls “one of the best secured cards” on the market.

Harzog said consumers wouldn’t be too adversely affected should Capital One ultimately elect to eliminate some of HSBC’s offerings, since the issuer already has some stand-out credit cards of its own. This includes its very popular Capitol One Ventures Rewards and VentureOne Rewards cards, which have been mainstays on many “best of” lists during the past year.

“Some of their offerings are so well-known,” Harzog said. “They’re not going mess with their branding.”

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