Ally Financial Sells Credit Card Business to CardWorks

Ally Financial is selling its credit card business, including a $2.3 billion portfolio with 1.3 million active cardholders, to CardWorks and its subsidiary, Merrick Bank, reports PaymentsDive. The financial details of the transaction remain undisclosed, but the deal is expected to close later this year.

This decision aligns with Ally’s strategy to simplify operations and focus on core business areas. "Selling the credit card business enables us to streamline our structure, prioritize key operations, and enhance returns," CEO Michael Rhodes stated.

CardWorks CEO Dan Pillemer described the acquisition as "a natural fit" and an important step in expanding their near-prime credit card offerings. This marks Ally’s second major divestiture in as many years; in 2024, it sold its $2.2 billion point-of-sale financing unit to Synchrony Financial. While spokespeople from both companies refrained from commenting further, more updates are expected upon the deal's finalization.