Nordstrom has sold its credit-card operation to Toronto-based TD Bank Group, handing off to the Canadian bank some $2.2 billion in receivables while inking a deal that will allow the Seattle retailer to manage customer service for the cards and get a cut of future revenue.
The move, which involves both Nordstrom’s U.S. Visa and private-label cards, is not a surprise. Executives have been talking about selling the operation for months, and in an earnings call earlier this month hinted that news was coming.
TD’s purchase of Nordstrom’s receivables boosts the retailer’s cash even as it retains control of the customer-facing part of the operation. TD will become the sole issuer of U.S. Nordstrom-branded Visa and private-label credit cards.
For customers, little should change. Nordstrom will continue to fund and manage its Nordstrom Rewards loyalty program, as well as its debit cards. Terms for the rewards program will remain unchanged, the company said.
The deal is expected to close in the second half of 2015, pending regulatory approvals.