MBNA may buy Canada Trust's MasterCard portfolio

U.S.-based MBNA is rumoured to be poised to buy the $1.8-billion MasterCard portfolio up for sale since Canada Trust was taken over by TD Bank, says a report in the National Post.

Quebec-based National Bank, a MasterCard issuer, is also considered a "dark horse" in the race, some say, and may be going after the merchant side of the credit card business.

Neither MBNA nor TD Bank will comment on the rumours.

The credit card portfolio has been up for sale as one of the conditions of TD's takeover of the trust company in February. Because TD issues Visa credit cards and Competition Bureau rules preclude a single financial institution from selling both brands, TD either had to convert its Visa holdings into MasterCard or sell CT's portfolio.

MBNA Corp., one of the world's largest credit card companies, has been steadily increasing its market share in Canada. At the end of December 1999, MBNA had $1.4 billion in outstanding credit card balances in Canada, up from about $600 million at the end of 1998.