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MBNA Corporation was a bank holding company and parent company of wholly owned subsidiary MBNA America Bank, N.A., headquartered in Wilmington, Delaware, prior to being acquired by Bank of America in 2006. It was the world's largest independent credit card issuer, specializing in affinity cards.
MBNA was founded in 1982 as Maryland Bank, N.A., a subsidiary of Maryland National Bank. The name MBNA is an initialism that was derived as an abbreviation or acronym of Maryland Bank, National Association. In 1989, Maryland Bank was renamed MBNA America Bank. MBNA Corp. spun off from Maryland National and became an independent company in 1991. Maryland National was acquired by NationsBank in 1993.
MBNA was founded in 1982 by a group of MNC Financial (regional bank holding company headquartered in Baltimore, Maryland) executives headed by Charles Cawley. Its first office was housed in a converted A&P supermarket in Ogletown, Delaware. Until his death, Cleveland Browns owner Al Lerner served as Chairman of the Board.
In 1995, MBNA moved its headquarters from a suburban location to Rodney Square in downtown Wilmington, Delaware. This investment was credited with helping to revive Wilmington's downtown real estate market.
Mergers and acquisitions
On June 30, 2005, MBNA announced that it was being acquired by Bank of America for stock and cash totalling more than $35 billion, reuniting MBNA with Maryland National in a roundabout way, as NationsBank acquired Bank of America in 1998. The deal was closed on January 1, 2006. The acquisition resulted in MBNA being renamed to Bank of America Card Services while still based in Delaware. For the first part of 2006, MBNA still issued credit cards under its own name associated with Mastercard, VISA, and American Express, but by the second half of 2006, all card products were re-branded as Bank of America.
At the same time in June 2005, MBNA bought Loans.co.uk (LCUK), then the UK's leading finance broker. Although figures were never released, various media outlets including newspapers in Watford where Loans.co.uk head office is based reported the deal made founders David Cowham and Steve Hayes worth £100m. MBNA/Bank of America have since decided to close Loans.co.uk due to the current market.
In 2002, MBNA purchased the credit card accounts of Working Assets of San Francisco, California When asked about this, Working Assets' employees have made differing claims. In one letter, it was stated that Working Assets chose MBNA regardless of its political views and entirely for its experience and quality customer service. In another letter, president Michael Kieschnick stated that Working Assets ended up under MBNA when the company purchased the credit card business of Fleet Bank, which had previously issued the card. Kieschnick said it was not Working Assets' choice to select MBNA and cannot change banks without violating its current contract.
On January 1, 2006, MBNA merged with and into Bank of America. MBNA America Bank, National Association, (MBNA) then became a wholly owned subsidiary of Bank of America. On June 10, 2006, MBNA changed its name to FIA Card Services, National Association (FIA), which is not an acronym. On October 20, 2006, Bank of America, National Association (USA), a subsidiary of Bank of America Corporation, merged with and into FIA. In Canada and Europe the MBNA name is retained. MBNA Europe headquarters is in Chester, England. MBNA Canada's headquarters are located in Ottawa. In 2007, the Canadian division was named one of Canada's Top 100 Employers. This purchase was a reunion of sorts. In 1993, NationsBank bought MNC Financial (whose credit card division was spun off years earlier to become MBNA). Five years later, the Bank of America that exists today was the result of the merger between the San Francisco-based Bank of America and the Charlotte-based NationsBank. In 2005, with Bank of America buying MBNA, it is in effect reuniting MNC Financial's credit card portfolio to its original banking assets and combining the Bank of America credit card portfolio with MBNA's.
Employing more than 25,800 people around the world at the time of the merger with Bank of America, MBNA owned or managed more than $122.5 billion in outstanding consumer credit loans. Most of this loan debt was held in securitized portfolios that had been sold to other entities such as insurance companies and pension funds. MBNA virtually invented the process for securitizing credit card debt and this process contributed significantly to the fast growth of the company. It allowed for increasing the amount loaned without having to acquire matching assets to offset the loans.
On August 15, 2011, MBNA announced that the Toronto-Dominion Bank (TD Canada Trust) would be purchasing MBNA's Canadian MasterCard portfolio. The acquisition of MBNA Canada by TD, which was completed on December 1, 2011, saw TD become a dual credit issuer (both Visa and MasterCard), become Canada's largest MasterCard issuer, and one of Canada's largest credit issuing banks.
In January 2013 Virgin Money agreed to buy £1 billion of assets from MBNA; these are the Virgin Credit Card assets which MBNA have serviced and managed in partnership with Virgin Money since 2002. The former Vice Chairman of MBNA Corporation, Lance Weaver, will become Virgin Money's President of Virgin Money Cards.
MBNA hired the son of Vice President Joe Biden during the years when Biden was a Senator and was pushing for bankruptcy reform legislation supported by the company. Because of the close relationship between Biden and MBNA, an article in National Review referred to Biden as the "Senator from MBNA". 
MBNA was one of the companies mentioned on a 2004 Frontline WGBH Boston PBS special about unfair business practices by credit card companies. Some practices that Frontline claimed MBNA has engaged in included doubling or tripling of interest rates, shifting billing due dates/payment cycles monthly, and raising rates for customers whose payments were a day or two late. MBNA has been found to be one of the leading implementors of rate-jacking. For further information and links, see credit card.
In Ireland, MBNA was accused of calling consumers up to eight times a day who were behind in making payments, which prompted the state debt advisory service to publicly state that harassment is outlawed. Affected people were advised to complain to the relevant authorities. The company in December 2009 admitted overcharging 500,000 Irish consumers up to €18 million.
In the UK, MBNA has come under fire for its interpretation of rules under which credit card providers must allocate payments to the debt with the highest interest rate first: one consumer site called MBNA's interpretation of these rules a "disingenuous money-making tactic"
- Staff writer (February 11, 2009). "Bank Of America Acquires MBNA". CBS News. Associated Press. Retrieved August 9, 2013.
- Affiliated staff (June 30, 2005). "Bank of America buys credit card firm MBNA". MSNBC. Associated Press. Retrieved August 9, 2013.
- USPages.com > Regional Banks > MBNA Corporation
- Ted Griffith (January 1, 2006). "MBNA gone, but what about jobs? New owner 'ready to pull the trigger'". The News Journal (Wilmington, Delaware).
- Nicholas Varchaver (May 13, 2002). "Who's The King Of Delaware?". FORTUNE Magazine.
- "Made it by 40". London: Daily Telegraph. 2006-12-13. Retrieved 2008-12-03.
- Yahoo! Finance: Form 8-K for FIA CARD SERVICES, NATIONAL ASSOCIATION at the Wayback Machine (archived July 16, 2007)
- "Reasons for Selection, 2007 Canada's Top 100 Employers".
- "Virgin Money announces launch of own credit card business after £1bn deal with MBNA to buy assets". 2013-01-18. Retrieved 2013-01-20.
- Maxed Out
- Knott, Alex (12:00 am, March 11, 2004 Updated: 1:04 pm, November 29, 2011). "Bush has a new top career patron MBNA surpasses Enron as the president's top lifetime contributor". The Center For Public Integrity. Retrieved February 3, 2013.
- PBS.com - Frontline: Secret History of the Credit Card
- "Credit card debtors 'harassed'". Irish Independent. October 22, 2009.
- "MBNA to refund €18m as interest error comes to light". The Irish Times. December 12, 2009.
- "MBNA to pay back €18m to 500,000 in card blunder". Irish Independent. December 15, 2009.
- "MBNA's new 'fairer' policy masks hidden costs". Choose. October 27, 2010.
- MBNA (Archive)
- Bank of America Official Site
- Yahoo! - MBNA Corporation Company Profile
- PBS video - Secret History of the Credit Card
- Information about MBNA's Corporate Foundation
- MBNA United Kingdom Credit Card Site