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Bloomberg
American Airlines Group Inc. expects new credit-card deals with Citigroup Inc. and Barclays Plc to boost its pretax income by about $1.55 billion over the next two-and-a-half years.
The accords will generate $200 million before taxes in the second half of this year, $550 million in 2017 and $800 million in 2018, the carrier said in a US regulatory filing Tuesday. The pacts extend existing partnerships the carrier has with both banks and will provide “continued modest improvement†in pretax income after 2018 compared with the current deals.
American, the world’s largest airline based on passenger traffic, said it expects the dual arrangement to provide higher growth in credit-card customers than a traditional accord with a single provider. The airline also announced that all new cards tied to its loyalty programme will carry the MasterCard brand from now on.
American rose 8.3 percent to $33.75 in New York this month, the biggest intraday gain since November 2014. Citigroup increased 2.3 percent and Barclays advanced 3.4 percent.
The two banks will issue AAdvantage co-branded credit cards starting in January.