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0402001 Informal Interpretation
us-ftc-hsr-informal-interpretations-4b21b72845fd4dd6b52feb9032a428270402001 Informal InterpretationGuidance
Date
Rule
7A(c)(1)
Response/Comments
The sale by Bank X of all of the credit card receivables is no the ordinary course of business, even if it continues in other lending activities (per DOJ). Continuum can be applied so only one filing is required.
Question
Verne, B. Michael
From: (redacted)
Sent: Tuesday,Februari03, 2004 10:08 AM
To: Verne,B. Michael
Cc: (redacted)
Subject: Sale ofCredit Card Receivables
Hi Mike - I am hoping that you can confirm that the following is exempt underordinary course.
FACTS: 1) Bank X intends to sell credit card receivables and related assets toLLC X in the amount of approximately $600 million. 2) After the transaction,Bank X will have in excess of $200 million in cash and will continue to operatea debit card business although it will no longer operate a credit cardbusiness. 3) Simultaneously with the closing, LLC X will transfer the creditcard receivables it purchased from Bank X to Trust Y for consideration equal tothe purchase price of the receivables. In order to fund the purchase of thereceivables, Trust Y will sell notes and certificates to investors. Trust Ywill be governed by an indenture, as is typical for these kinds of transactions.
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