Wells to Sell $700 Million in Credit Card Loans

Wells Fargo & Co. is selling credit card accounts with about $700 million in loans, nearly 16% of its portfolio, as it weeds out poorly performing customers, sources close to the bank said. Wells, which hired Lehman Bros. Holdings Inc. to find a buyer, expects to get bids on the portfolio as early as today. Analysts said possible buyers include San Francisco-based Providian Financial Corp. and Minnesota-based Metris Cos., both of which specialize in managing credit card portfolios with high delinquency rates. Except for the largest card companies, card accounts outside a bank’s market “take up corporate resources which could be better allocated somewhere else,” said Steven Eisman, an analyst at CIBC Oppenheimer Corp. Wells and Providian representatives declined to comment. A spokesman for Metris couldn’t be reached. Wells’ portfolio consists of customers outside its main banking territory. At the end of 1997, about $133 million in credit card loans, 2.64% of Wells’ total portfolio, were 90 days or more past due. The portfolio to be sold has a higher delinquency rate. Wells recently agreed to be acquired by Norwest Corp.