Earlier today, MasterCard announced
that it had won the debit card business away from Visa at SunTrust. In an article titled "MasterCard’s SunTrust Coup Includes Credit As Well As Debit Cards
", Digital Transactions reports that SunTrust's "agreement with MasterCard also will bring MasterCard-branded cards to SunTrust’s 1-million-card credit portfolio that currently is 100% Visa."
As a practical matter, we're not surprised. These kinds of portfolio negotiations tend to swing everything of significance to an issuing bank over to the winning card network - in exchange for a financially attractive arrangement for the issuer.
The last time this happened was five years ago this month when MasterCard and Washington Mutual announced WaMu's conversion of debit cards to MasterCard. Subsequently, of course, WaMu was acquired by JPMorganChase when the FDIC took it over - and we're still waiting to hear how Chase plans to deal with WaMu's debit card relationships.
We look forward to the upcoming Visa (Feb 3) and MasterCard (Feb 4) investor calls when this subject will certainly be probed more deeply.