PR - FNB United Corp Sells Credit Card Portfolio

FNB United Corp. (NASDAQ: FNBN), parent of CommunityONE Bank, N.A., announced continued progress in its integration of recent acquisitions United Financial, Inc., and Integrity Financial, Inc. As part of the integration, CommunityONE Bank has sold its credit card portfolio, along with multiple portfolios acquired from former Integrity and United subsidiaries, to Élan Financial Services, a division of US Bank (NYSE: USB).

As a result of the sale, FNB United Corp will recognize a $1.3 million non-recurring gain which will be reported with its third quarter results. Of that amount, $1.0 million will be from the sale of the portfolio and $300,000 resulting from the recapture of the allowance for loan loss reserve associated with the $4.0 million sold portfolio. Concurrently, a $250,000 expense has been recognized to cover the buyout of two of the unexpired contracts with Visa.

“This new partnership with Élan will significantly increase the number and quality of credit card offerings to the Bank’s retail and commercial customers,” said Mark Hensley, CommunityONE Chief Banking Officer. “We will be far more competitive in the credit card arena than we’ve ever been. Retail customers will be provided with seven different products, including Visa Platinum, Secured Visa and Visa Signature products. Four different products will be made available to commercial customers, and both the retail and commercial offerings have a variety of rewards programs. These improved programs will permit CommunityONE to increase fee income through a revenue sharing arrangement with Élan on current and new cards.”

“The unification of credit card programs is an example of the progress we are making in bringing these companies together as a single team,” said Michael C. Miller, FNB United President. “We are improving product offerings and at the same time reducing expense, operating more efficiently, and reducing risk.”