Morgan Stanley has bought the Goldfish credit card business of bank Lloyds TSB for £1 billion pounds, a premium of £175 million to the unit's net balances.
The US bank said the acquisition would significantly expand its existing credit card business, increasing its number of accounts by 47 per cent to over 2.3 million and adding 800 million pounds worth of balances to its existing £1.5 billion book of business.
"This acquisition is consistent with Morgan Stanley's stated strategy of growing our international business by taking opportunities for bolt-on acquisitions and further underscores our increasing resource commitment to the UK and Europe," David Walker, chairman of Morgan Stanley International, said in a statement.
Lloyds TSB, Britain's fifth-largest bank by assets, said it would make a profit before tax of £70 million from the cash deal, which also includes the Goldfish brand and loyalty programme.
Terri Dial, Lloyds' head of retail, said the group wanted to concentrate on growing its own Lloyds TSB-branded credit card business.
In 2003, Lloyds bought the 70 per cent stake in Goldfish it did not own from UK utility group Centrica for a premium of £112.5 million pounds.