After a messy divorce with Buffalo-based M&T Bank last fall, supermarket chain Giant Foods inked a contract with Chevy Chase Bank yesterday to become the new issuer of the cobranded ‘Giant VISA’ and ‘Super G VISA’ card. Cardholders of the M&T-Giant card may continue to earn rebates through March 28 but will be required to apply for the Chevy Chase-Giant card to continue earning rebates afterwards. The rebate structure will be the same: 3% for Giant purchases and 1% for purchases elsewhere. M&T sought to terminate the program in October after realizing heavy losses with the relationship. Giant cardholders charged an average of $8,000 per year with little revolving activity. Giant is currently pursuing M&T for damages.
Giant Food Inc. (AMEX: GFS.A) and Chevy Chase Bank today announced that they have signed a contract whereby Chevy Chase Bank would become the new issuer of the co-branded Giant and Super G VISA card. under the agreement, cardholders will continue to receive rebates of 3% for purchases made at Giant and 1% for purchases made elsewhere. Applications for the Giant-Chevy Chase credit card program will be available beginning February 16.
Giant Food Chairman, Pete Manos said: “Our company is delighted that we have been able to preserve the rebate program for our customers. Our top priority in this matter over the past few months has been to do all we can to take care of our customers who are cardholders. We are also pleased that we are now partnered with one of the leading banks in our area. Many of Giant’s customers are also Chevy Chase’s customers, and we believe this will be an added plus for the program. We intend to aggressively promote our new Giant-Chevy Chase VISA card.”
Chevy Chase Bank Chairman, B. Francis Saul, II said: “Chevy Chase welcomes this partnership with Giant as an opportunity both to provide enhanced services to our joint customers and to further strengthen the long-term relations that we have with Giant.”
The previous issuer of the Giant VISA card, M&T Bank in Buffalo, New York, notified Giant in October that it intended to terminate the program. Although Giant has contested M&T’s right to terminate its contract, it has since worked to partner with a new issuer who would keep the rebate program in effect. Customers using their current Giant credit card will continue to earn rebates until March 28, 1997 and rebates certificates already issued will be honored as long as they are redeemed prior to the expiration date of the certificate. Current cardholders who wish to continue to earn rebates with a Giant VISA card after March 28 need to apply for the Giant-Chevy Chase VISA card. “We recognize the temporary inconvenience this may cause current cardholders but we accept its necessity for the transition between the two programs,” commented Manos.
Giant operates 174 stores in Virginia, Maryland and the District of Columbia, including nine Super G stores in Delaware, New Jersey and Pennsylvania. Giant had sales of $3.9 billion last year and employs 27,500 associates.
Chevy Chase Bank is a local financial institution, headquartered in Chevy Chase, Maryland, with over $5 billion in assets. Chevy Chase Bank offers consumers and businesses a wide variety of financial products and services through over 115 branch offices and more than 550 ATM locations in Maryland, Virginia and the District of Columbia.