Citigroup Inc. has sold $1.6 billion of retail credit card assets to General Electric Co.'s GE Capital arm, the companies said Wednesday.
The sale further reduces the amount of assets that are part of Citi Holdings, the unit the New York bank created in 2009 to house its non-core businesses.
Terms of the deal were not disclosed.
"Going forward, we are better positioned for future growth as we continue to partner with premier brand retailers across a broad spectrum of industries and retailing specialties," Bill Johnson, the chief executive of Citi's Retail Partner Cards business, said in a press release.
The operation that Citi sold issues co-branded and private-label credit cards for retailers including Home Depot Inc., Sears Holdings Corp. and Exxon Mobile Corp. It services more than 40 million customers and has about $50 billion in managed assets.
Citi said it plans to service the accounts until the first quarter of 2011.
GE said in a press release that the portfolios it is buying include about three dozen retail partner relationships representing more than 18,000 small to mid-sized merchant locations.
"This acquisition is right in line with GE Capital's goal to invest in core, high performing growth businesses where we have deep experience and broad capabilities to grow," Mark Begor, the president and CEO of GE Capital Retail Finance, said in the release.
Retail cards, which typically carry higher delinquency and charge-off rates than general-purpose credit cards, were hit hard in the most recent recession.
In an interview last month, Johnson said Citi was continuing to evaluate options for its retail card portfolios.