ank of America (BofA) announced on July 13, 2004 it reached a definitive agreement to purchase National Processing Co. (NPC). The acquisition is expected to be complete by the end of the year. The newly combined Bank of America Merchant Services will create the nation's second largest bankcard merchant acquirer with nearly $250 billion in annual processing volume.

Through its various partnership interests in companies including Chase Merchant Services and Paymentech, First Data Corp.'s card transaction volume totaled almost $500 billion in 2003, ranking it first among merchant acquirers. Pending shareholder and regulatory approval, National City Corp. will sell its 83% share of NPC stock to BofA for $1.4 billion.

NPC provides services to approximately 700,000 merchant locations across North America through its Merchant Card Services unit. NPC processes nearly one out of every six Visa and MasterCard transactions nationally.

BofA issues more debit cards in the United States than any other company. It's ranked fourth in the number of credit cards issued and is the number one check processor in the country, according to the company.

In June, The Green Sheet reported that National City was seeking potential buyers for its wholly owned subsidiary, NPC (see "The Acquirer Shuffle," issue 04:06:02, June 28, 2004). National City is one of the nation's largest financial holding companies; some analysts speculated that it was anxious to get out of the merchant acquiring business. The BofA/NPC merger is the latest announcement in what's turning out to be a very eventful summer in the acquiring industry.

The J.P. Morgan Chase acquisition of Bank One was completed on July 1, and on July 7, the newly-formed company, now called J.P. Morgan Chase & Co., announced it had selected TSYS, not First Data, as the processing services provider for its 87 million Visa and MasterCard-branded cards (see story, page 87).

On July 6, Retriever Payment Systems received $250 million in recapitalization from investment firm GTCR Golder Rauner, LLC. On June 21, Wal-Mart and MasterCard put aside their interchange dispute; customers can once again use signature debit cards to make purchases.