American Express has won exclusive rights to issue Hilton credit cards, ending an agreement that saw Citi and AmEx share those privileges. The change will go into effect as of January 1st according to Bloomberg. It seems AmEx was not about to have another partner run to a competitor after both Costco and JetBlue defected. The SPG card is of course at risk with Marriott’s co-brand deal with Chase.
Citigroup said the terms of the Hilton deal didn’t make economic sense for a relatively small portfolio. Hilton represents about 1 percent of the bank’s $126.4 billion U.S. credit-card loans. “For over 15 years, Citi and Hilton enjoyed a terrific co-brand credit card partnership, however during negotiations it became clear that terms of exclusivity, given the relatively small size of the portfolio, were not economically viable,” Jud Linville, CEO of Citigroup’s global cards business, said in a phone interview. Citigroup intends to focus on “core” co-brand partners including Costco, American Airlines Group Inc. and AT&T Inc., he said.
Hilton says that the bidding process received a huge response from issuers and that AmEx was selected based on their focus on innovation.
“We’re not announcing any new benefits at this time, but I think Hilton Honors members can look forward to new cardmember benefits,” said Denise Pickett, president of U.S. consumer services at American Express.