Wells Fargo is reportedly looking to sell its private-label credit cards business as part of its broader restructuring strategy to save costs.
This cards business offers store-branded credit card and point-of-sale (POS) financing options, Bloomberg reported citing people familiar with the matter.
The unit ties up with the retailer to enable shoppers to buy jewellery, appliances and furniture on credit.
Wells Fargo has started approaching possible bidders directly for a deal, the report added.
The lender is unable to determine the retail-financing unit’s worth.
However, the report also stressed that the bank has not made any final decisions on the unit’s disposal and may choose to retain the business.
Initially, back in 2014, Well Fargo said it was planning to build its private-label portfolio.
However, it was unable to keep up with other private-label companies including Synchrony Financial, Citigroup and Capital One, noted Bloomberg.
According to one Nilson Report – an industry publication – Synchrony has a market share of 40% in the cards business, while Wells Fargo’s market share fell to 5.75% last year.
The latest move is part of the turnaround strategy of Wells Fargo, which was embroiled in a major sales practices scandal.
During the third-quarter earnings call, CEO Charles Scharf told analysts that the bank will exit non-core businesses to boost its balance sheet.
Last month, Bloomberg reported that Wells Fargo is exploring the sale of its corporate-trust arm as well as its $10bn student-loan portfolio.
Wells Fargo is reportedly also looking to sell its asset management business, which managed $578bn as of the end of June this year.