September 18, 2024 – According to a recent report published by The Wall Street Journal on September 17th, JP Morgan Chase is currently engaged in discussions with Apple, potentially taking over the Apple Card credit card business from Goldman Sachs.
The report indicates that both parties are negotiating the specifics of a possible agreement. While the negotiation process has accelerated in recent weeks, it could still take several months to finalize and sign any related contracts, even if a partnership is indeed reached.
Sources close to the matter have revealed that JP Morgan Chase has put forward certain conditions for the acquisition. These include paying no more than the face value of the $17 billion in unpaid balances owed by Apple Card holders, and discontinuing the Apple Card billing cycle, which is currently synchronized with calendar months and has caused customer service issues.
Typically, the transfer price for credit card businesses may equal or slightly exceed the total loan amount. However, if these accounts have a high default rate or other issues, the price may decrease. Apple’s credit card program includes some higher-risk customers (subprime credit), and the existing partnership terms could potentially incur significant costs for any incoming bank.
