Posted on December - 28 - 2009
Bank of America’s Big Credit Card Fix
Every once in a while there is always one company that comes along that is said to have grown too big, too quickly. While this is generally not the case when it comes to financial institutions, it is definitely the case with it comes to banking giant, Bank of America. Now according to an article in the Wall Street Journal entitled, “New Chief at Bank of America Seeks Credit-Card Fix”, it looks like there are major changes ahead of the nation’s largest banking institution in order to get back on track.
From this article, it looks as the man in charge looks to reposition his company’s credit card portfolio as one of quality over quantity. While in the past one of the primary goals was to have more cardholders, it resulted in very high losses as default rates increased to record numbers. Even now Bank of America still reels in heavy losses due to the poor decision making of extending credit to those who would have not qualified under other circumstances.
So will Bank of America, get back to the dominance level that it was once at? While the answer is more than likely yes, it will take some time and a better marketing strategy. As far as moving forward, the new CEO has made it a point to no longer extended credit cards to everyone who applies (or doesn’t apply for that matter). The focus will now be on extending more financial offers to their current customer base, and making sure that that those who are extended credit by way of credit card know exactly what they are getting.
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