Visa Sets Aside $800M In Account To Cover Lawsuits
SAN FRANCISCO (AP) - Visa Inc. on Tuesday said it set aside $800 million to cover legal obligations, and completed its $1 billion share repurchase plan.
The electronic payment processing company said it deposited the $800 million in its litigation escrow account, a move that had previously been announced. That account was set up when Visa went public in 2008 to cover outstanding lawsuits.
The account covers a host of lawsuits filed by merchants over interchange fees, or the fees that are charged to merchants for processing credit and debit card payments. Those suits have been combined and are working through federal court.
It also includes funding for a settlement with American Express reached in 2007, which requires Visa to pay up to $1.12 billion in quarterly increments of $70 million through 2011. And it covered a 2008 settlement with Discover Financial Services Inc. for $1.89 billion that was paid last year.
In addition, the company said it completed its $1 billion share repurchase plan authorized in October 2009. Visa bought back 4.6 million shares of class A common stock in its fiscal fourth quarter at an average price of $72.29 per share.
Under the plan, the company bought back 12.9 million shares of class A common stock at an average price of $77.48 per share.
Visa shares slipped 24 cents to $74.05 in afternoon trading. The stock has traded between $64.90 and $97.19 in the past 52 weeks.
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