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Last Updated : Aug 09, 2019 02:52 PM IST | Source: Moneycontrol.com

Visa's m-cap is now more than JPMorgan, other banks that owned it

Prior to the March 2008 initial public offering in which it cashed out of Visa, JPMorgan used to be one of the owners of the company.

On August 7, Visa’s market capitalisation soared to $348 billion, making it the world’s most highly-valued financial firm after Berkshire Hathaway Inc, Bloomberg reported.

Visa, which was earlier owned by some of the country’s biggest banks, surpassed investment bank and financial services company JPMorgan & Chase Co for the first time in terms of market value. Prior to the March 2008 initial public offering in which it cashed out of Visa, JPMorgan used to be one of the owners of the company.

The company’s stock has risen by around 1500 percent since the IPO, which was among the biggest in history. The KBW Bank Index has seen an uptick of around 15 percent.

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Bloomberg Intelligence payments analyst David Ritter told Bloomberg that Visa was intrinsically poised for success. “The big tailwind at its back is commerce going electronic,” Ritter said. “They’re just in a great business and a very enviable position,” he added.

Calling banks’ decision to break off card networks “one of the biggest strategic blunders of the last 20 years,” former CEO of American Express  Ken Chenault told Bloomberg that banks gave up on the card networks when cheap, and the situation is completely reversed now. This can be seen in the light of card networks offering a digital payment mode right at the time when the e-commerce space took off and became big.

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First Published on Aug 9, 2019 02:52 pm
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