Scotiabank buys JPMorgan's Canadian credit card operations

Scotiabank has agreed to buy U.S. bank JPMorgan Chase's credit card portfolio in Canada, which includes the Sears Canada credit cards.

The bank announced the deal Thursday, but did not release financial terms.

Scotiabank is acquiring JPMorgan's MasterCard and Sears card portfolio, along with the call centre and security operations associated with the cards. It is Scotiabank's first foray into MasterCard in Canada.

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It gains about two million credit card customers and receivables of about $1.7 billion a year.

"This transaction is in line with our strategy to grow Scotiabank's payments business, including credit cards, while providing our shareholders with attractive risk adjusted returns," said James O'Sullivan, group head of Canadian banking at Scotiabank.

Troubled retailer Sears Canada has been seeking a new partner to handle its credit card for the past yearafter JPMorgan announced it would terminate their agreement Nov. 15.

Scotiabank has rested part of its growth strategy on an expanded credit card business, partnering with Cineplex and buying 20 per cent of Canadian Tire's financial services business.