Canadian Imperial Bank of Commerce is to continue issuing Air Canada Corp.'s cobranded credit card, after securing the contract this week.
It isn't all roses for the group howver, CIBC will now have to share the business with another issuer, according to a report filed Tuesday by the airline's bankruptcy monitor and submitted for judicial approval.
The bank's longstanding contract was thrown into play last month, when Air Canada filed for bankruptcy protection.
CIBC and five other bidders were evaluated according to how much they offered to pay per airline point, how long the contract would last, how much cash they were willing to pay, what marketing commitments they were willing to make, and exclusivity.
According to the report, two of the bids warranted additional consideration, with CIBC having the right to approve the eventual second issuer.
Christopher Theoharides of Advantage Consulting Group, the Massapequa, N.Y. firm that helped negotiate Air Canada's U.S. co branding partnership, said he thinks its U.S. partner, MBNA Corp., was among the finalists for the Canadian issuing rights. MBNA is the second-largest MasterCard issuer in that country, with $2.7 billion of receivables there.
American Express Co., Bank One Corp., and Citigroup Inc. were also rumoured to be bidders.
