First Interstate Is Selling Credit-Card Portfolio

First Interstate Bancorp, continuing its restructuring program, said Thursday that it is selling a nearly $500-million credit-card portfolio to Associates Corp. of North America, a Dallas-based commercial and consumer finance company.

Separately, Wells Fargo Bank agreed Thursday to buy the $280-million credit-card portfolio held by Imperial Corp. of America, parent of Imperial Savings in San Diego.

The portfolio involves about 500,000 MasterCard and Visa credit card accounts with a total balance ranging from $425 million to $475 million. The sale does not represent all of First Interstate’s credit-card operations. Customers, whose accounts are serviced by First Interstate Bancard in Simi Valley, are located largely outside of California.

Neither First Interstate, the Los Angeles-based parent of First Interstate Bank, nor Associates Corp. would disclose the premium being paid, although First Interstate said it will record a $44-million gain in the third quarter stemming from the sale. Based on premiums paid recently for other credit-card operations, the premium First Interstate is receiving is probably less than $90 million.

Imperial Corp. said it expects to receive a 24% premium, or about $67 million, on its sale. The San Diego thrift, which also has been restructuring, said it expects to post a substantial gain in the fourth quarter as a result of the sale.

The sales follow by a month California Federal Bank’s sale of its credit card portfolio to Household Bank. The market for credit-card operations has been heating up, in part because operations are highly profitable and because several large consumer finance companies have been buying up credit-card servicing operations.

Among the unit’s jobs are to process credit-card slips and billings. First Interstate Bank will continue to offer credit cards to customers.