Only hours after Fiserv Inc completed the acquisition of First Data Corp, Bank of America Corp announced that it would end its electronic payment services joint venture with the payment processor, Bank of America Merchant Services, in June 2020.
The termination of the partnership, which was started in 2009, is expected to cost the North Carolina-headquartered bank a non-cash, pre-tax impairment charge of $1.7 billion to $2.1 billion in the third quarter of 2019.
According to the statement released by the American bank, it and First Data Corp have agreed to provide “uninterrupted delivery of products and services” to Banc of America Merchant Services’ clients until at least June 2023.
Despite canceling the agreement with First Data Corp, the US firm states that the payments processor will continue to be an “important service provider” which will support Bank of America’s global payment solutions.
First Data Corp is a Georgia headquartered firm, which processes $2.4 trillion each year and 2,500 transactions per second. It operates as a payment technology company that handles a wide range of services, including credit card processing.
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Commenting on the announcement, Mark Monaco, head of Enterprise Payments at Bank of America said: “Payments are at the core of our business, and this announcement is another step forward in our global strategy to provide companies of all sizes an integrated payment offering.
“We look forward to investing in our merchant solution and delivering the capabilities our clients need to thrive in an ever-changing payments environment. We look forward to continuing our long-standing business relationship with First Data.”
Fiserv completes acquisition of First Data Corp
As Finance Magnates reported, back in January Fiserv announced its plans to acquire payment technology provider First Data Corporation in a $22 billion all-stock deal to be completed in the first half of 2019.
On Monday, the company announced that it had completed the acquisition, making it a leading payments and financial technology provider.
Fiserv’s shares were down 1.5 percent at $103.10 in extended trading. The Bank of America’s, on the other hand, were largely unchanged.