Washington, D.C. 20549
BA CREDIT CARD FUNDING, LLC
(Exact name of depositor as specified in its charter)
FIA CARD SERVICES, NATIONAL ASSOCIATION
(Exact name of sponsor as specified in its charter)
________________
________
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
BA Master Credit Card Trust II, Series 1997-B Floating Rate Asset Backed Certificates.
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ¨ No xý
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ¨ No xý
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. xý Yes ¨ No
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). xý Yes ¨ No [Rule 405 of Regulation S-T is not applicable.]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant'sregistrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. xý [Item 405 of Regulation S-K is not applicable.]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large“large accelerated filer," "accelerated filer"” “accelerated filer” and "smaller“smaller reporting company"company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ¨ 0; Accelerated filer ¨
Non-accelerated filer xý (Do not check if a smaller reporting company) &# 160; Smaller reporting company ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ¨ No xý
Registrant has no voting or non-voting common equity outstanding held by non-affiliates.
INTRODUCTORY NOTE
FIA Card Services, National Association ("FIA"(“FIA”) is the originator, seller, and servicer under the Second Amended and Restated Pooling and Servicing Agreement, dated as of October 20, 2006 (as amended, supplemented or otherwise modified from time to time, the "Agreement"“Agreement”), and the Series 1997-B Series 2000-H, and Series 2001-B SupplementsSupplement dated as of February 27, 1997 August 23, 2000, and March 8, 2001 (in each case, as(as amended, supplemented or otherwise modified from time to time), respectively, by and between FIA and the trustee, providing for the issuance of the BA Master Credit Card Trust II Series 1997-B Series 2000-H, and Series 2001-B Floating Rate Asset Backed Certificates (the "Certificates"“Certificates”) and is the originator of the BA Master Credit Card Trust II (the "Trust"“Trust” and the "Registrant"“Registrant”). The Certificates do not represent obligations of or interests in FIA. In November 1988, FIA (formerly known as MBNA America Bank, National Association) made application under the Securities Exchange Act of 1934 for an exemption from certain reporting requirements. On December 30, 1988, the staff of the Securities and Exchange Commission'sCommission’s Division of Corporation Finance granted FIA'sFIA’s exemption request, pursuant to which FIA is not required to respond to various items of Form 10-K. Such items are designated herein as "Not Applicable"“Not Applicable”.
PART I
Item 1: Business.
Not Applicable.
Item 1A: Risk Factors.
Not Applicable.
Item 1B: Unresolved Staff Comments.
Not Applicable.
Item 2: Properties.
Not Applicable.
Item 3: Legal Proceedings.
Industry Developments
FIA issues credit cards on MasterCard'sMasterCard’s and Visa'sVisa’s networks. MasterCard and Visa are facingsubject to settlement obligations relating to certain litigations and continue to be subject to significant litigationongoing litigations, including class actions, and increased competition. In 2003,These settlements and litigations are based on, among other things, claimed violations of United States federal antitrust laws, claims that currency conversion fees were wrongly applied on purchases of goods and services in foreign countries, and claims alleging that the interchange charged by MasterCard and Visa settled a suit by Wal-Mart and other merchants who claimed that MasterCard and Visa unlawfully tied acceptance of debit cards to acceptance of credit cards. Under the settlement MasterCard and Visa are required to, among other things, allow merchants to accept MasterCard or Visa branded credit cards without accepting their debit cards (and vice versa), reduce the prices charged to merchants for off-line signature debit transactions for a period of time, and pay amounts totaling $3.05 billion into a settlement fund. MasterCard and Visa are also parties to suits in various state courts mirroring the allegations brought by Wal-Ma rt and the other merchants.
is impermissible. The costs associated with these settlements, litigations and other matters could cause MasterCard and Visa to invest less in their networks and marketing efforts and could adversely affect the interchange paid to their member banks, including FIA.
Litigation
BankA group of America Corporation and certainmerchants have filed a series of its subsidiaries are defendants in putative class actions filed on behalf of retail merchants that acceptand individual actions with regard to interchange fees associated with Visa and MasterCard payment cards. Additional defendants include Visa, MasterCard, and other financial institutions. Plaintiffs,card transactions. These actions, which seek unspecified treble damages and injunctive relief, allege that the defendants conspired to fix the level of interchange and merchant discount fees and that certain other practices, including various Visa and MasterCard rules, violate federal and California antitrust laws. The class actions, the first of which was filed on June 22, 2005, are coordinated for pre-trial proceedingshave been consolidated in the U.S. District Court for the Eastern District of New York together with individual actions brought only against Visa and MasterCard, under the caption In Re Payment Card Interchange Fee and Merchant Discount Anti-Trust Litigation. (“Interchange”), name Visa, MasterCard and several banks and bank holding companies, including Bank of America Corporation, as defendants. Plaintiffs allege that the defendants conspired to fix the level of default interchange rates, which represent the fee an issuing bank charges an acquiring bank on every transaction. Plaintiffs also challenge as unreasonable restraints of trade under Section 1 of the Sherman Act certain rules of Visa and MasterCard related to merchant acceptance of payment cards at the point of sale. Plaintiffs seek unspecified damages and injunctive relief based on their assertion that interchange would be lower or eliminated absent the alleged conduct. On January 8, 2008, the District Court dismissedcourt granted defendants’ motion to dismiss all claims for pre-2004 damages. On May 8, 2008, plaintiffs filed aMotions to dismiss the remainder of the complaint and plaintiffs’ motion for class certification which the defendants opposed. On January 29, 2009, the class plaintiffs filed a second amended consolidated complaint.are pending.
The classIn addition, plaintiffs have also filed two supplemental complaints against certain defendants, including Bank of America Corporation, and certain of its subsidiaries, relating to MasterCard's 2006 initial public offeringofferings (the “IPOs”) of MasterCard IPO) and Visa's 2008 initial public offering (theVisa. Plaintiffs allege that the MasterCard and Visa IPO). The supplemental complaints, which seek unspecified treble damagesIPOs violated Section 7 of the Clayton Act and injunctive relief,Section 1 of the Sherman Act. Plaintiffs also assert among other things, claims under federal antitrust laws. On November 25, 2008, the District Court granted defendants' motion to dismiss the supplemental complaint relating tothat the MasterCard IPO with leavewas a fraudulent conveyance. Plaintiffs seek unspecified damages and to amend.undo the IPOs. Motions to dismiss both supplemental complaints were filed in March 2009 and the motions remain pending. On January 29, 2009,June 20, 2011, plaintiffs amendedand defendants both moved for summary judgment. Those motions are also pending; oral argument on the MasterCard IPO supplemental complaint and also filed a supplemental complaint relatingsummary judgment motions is scheduled for November 2, 2011. Trial has been scheduled to the Visa IPO.begin on September 12, 2012.
Defendants have filed motions to dismiss the second amended consolidated complaint and the MasterCard IPO and Visa IPO supplemental complaints.
Bank of America Corporation and certain of its subsidiaries haveaffiliates previously entered into loss-sharing agreements with Visa and other financial institutions that provide for sharing liabilities in connection with certain antitrust litigation against Visa, including
Interchange. Bank of America Corporation and these same affiliates have now entered into additional loss-sharing agreements for Interchange that cover all defendants, including MasterCard. Collectively, the loss-sharing agreements require Bank of America Corporation and/or certain affiliates to pay 11.6 percent of the monetary portion of any comprehensive Interchange settlement. In the event of an adverse judgment, the agreements require Bank of America Corporation and/or certain affiliates to pay 12.8 percent of any damages associated with Visa-related claims (“Visa-related damages”), 9.1 percent of any damages associated
In Re Payment Card Interchange Fee with MasterCard-related claims, and Merchant Discount Anti-Trust Litigation11.6 percent of any damages associated with internetwork claims (“internetwork damages”) or not associated specifically with Visa or MasterCard-related claims (“unassigned damages”).
Pursuant to Visa’s publicly-disclosed Retrospective Responsibility Plan (the Visa-Related Litigation). Under these agreements, Bank of America Corporation's obligations to“RRP”), Visa in the Visa-Related Litigation are capped at Bank of America Corporation's membership interest in Visa USA, which currently is 12.9%. Under these agreements, Visa Inc. placed a portion of thecertain proceeds from the Visaits IPO into an escrow to fund liabilities arising from(the “Escrow”). Under the Visa-Related Litigation, includingRRP, funds in the 2008 settlement of Discover Financial Services v.Escrow may be accessed by Visa USA, et al.and the 2007 settlement of American Express Travel Related Services Company v. Visa USA, et al.& #160; Since the Visa IPO, Visa Inc. has added funds to the escrow, which has the effect of repurchasing Visa Inc. Class A common stock equivalents from the Visa USAits members, including Bank of America, Corporation.to pay for a comprehensive settlement or damages in Interchange
, with Bank of America Corporation’s payments from the Escrow capped at 12.81 percent of the funds that Visa places therein. Subject to that cap, Bank of America Corporation may use Escrow funds to cover: 73.9 percent of its monetary payment towards a comprehensive Interchange settlement, 100 percent of its payment for any Visa-related damages and 73.9 percent of its payment for any internetwork damages and unassigned damages.
Item 4: Submission of Matters to a Vote of Security Holders.(Removed and Reserved).
Not Applicable.
PART II
Item 5: Market for Registrant'sRegistrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
The Certificates of each series representing investors'investors’ interests in the Trust are represented by one or more Certificates registered in the name of Cede & Co., the nominee of The Depository Trust Company.
Item 6: Selected Financial Data.
Not Applicable.
Item 7: Management'sManagement’s Discussion and Analysis of Financial Condition and Results of Operations.
Not Applicable.
Item 7A: Quantitative and Qualitative Disclosures about Market Risk.
Not Applicable.
Item 8: Financial Statements and Supplementary Data.
Not Applicable.
Item 9: Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
Not Applicable.
Item 9A: Controls and Procedures
Not Applicable.
Item 9B: Other Information.
None.
PART III
Item 10: Directors, Executive Officers and Corporate Governance.
Not Applicable.
Item 11: Executive Compensation.
Not Applicable.
Item 12: Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
(a) The Certificates of each series representing investors'investors’ interests in the Trust are represented by one or more Certificates registered in the name of Cede & Co., the nominee of The Depository Trust Company ("DTC"(“DTC”), and an investor
holding an interest in the Trust is not entitled to receive a Certificate representing such interest except in certain limited circumstances. Accordingly, Cede & Co. is the sole holder of record of Certificates, which it holds on behalf of brokers, dealers, banks and other direct participants in the DTC system at June 30, 2010.2011. Such direct participants may hold Certificates for their own accounts or for the accounts of their customers. At June 30, 2010,2011, the following direct DTC participants held positions in Certificates representing interests in the Trust equal to or exceeding 5% of the total principal amount of the Certificates of one or more series outstanding on that date, as indicated. The information on DTC participants'participants’ held positions is pr ovidedprovided by DTC.
| | | | |
| Series | | Participant Full Name | | Total | | Total |
| | | | |
| 1997-B Class A | JPMorgan Chase Bank, National Association | $452,768,000.00 | 53.3% |
| | State Street Bank and Trust Company | $148,039,000.00 | 17.4% |
| | The Bank of New York Mellon | $99,494,000.00 | 11.7% |
| | JPMorgan Chase Bank / Broker & Dealer | $86,686,000.00 | 10.2% |
| | Merrill Lynch, Pierce Fenner & Smith | $43,600,000.00 | 5.1% |
| | | | |
| 1997-B Class B | JPMorgan Chase Bank, National Association | $32,800,000.00 | 43.7% |
| | Citibank, N.A. | $31,200,000.00 | 41.6% |
| | UMB Bank, National Association | $5,000,000.00 | 6.7% |
| | | | |
| 2000-H Class A | JPMorgan Chase Bank, National Association | $275,170,000.00 | 46.2% |
| | State Street Bank and Trust Company | $153,950,000.00 | 25.9% |
| | JPMorgan Chase Bank / Broker & Dealer | $77,980,000.00 | 13.1% |
| | The Bank of New York Mellon | $33,740,000.00 | 5.7% |
| | | | |
| 2000-H Class B | JPMorgan Chase Bank, National Association | $28,000,000.00 | 53.3% |
| | The Bank of New York Mellon | $14,500,000.00 | 27.6% |
| | Mitsubishi UFJ Trust & Banking Corporation | $10,000,000.00 | 19.0% |
| | | | |
| 2001-B Class A | JPMorgan Chase Bank, National Association | $216,890,000.00 | 34.0% |
| | JPMorgan Chase Bank / Broker & Dealer | $161,860,000.00 | 25.4% |
| | Federal Reserve Bank of New York | $50,000,000.00 | 7.8% |
| | The Bank of New York Mellon | $45,700,000.00 | 7.2% |
| | Bank of America / LaSalle Bank NA | $40,000,000.00 | 6.3% |
| | U.S. Bank N.A. | $39,000,000.00 | 6.1% |
| | State Street Bank and Trust Company | $32,380,000.00 | 5.1% |
| | | | |
| 2001-B Class B | The Bank of New York Mellon | $36,250,000.00 | 64.4% |
| | Brown Brothers Harriman & Co. | $20,000,000.00 | 35.6% |
| | | | |
| Series | Participant Full Name | Total | Total |
| | | | |
| 1997-B Class A | JPMorgan Chase Bank, National Association | $323,084,000 | 38.01% |
| | State Street Bank and Trust Company | $283,443,000 | 33.35% |
| | The Bank of New York Mellon / Mellon Trust of New England, National Association | $87,991,000 | 10.35% |
| | The Bank of New York Mellon | $78,914,000 | 9.28% |
| | Merrill Lynch, Pierce Fenner & Smith | $43,600,000 | 5.13% |
| | | | |
| 1997-B Class B | JPMorgan Chase Bank, National Association | $33,800,000 | 45.07% |
| | Citibank, N.A. | $31,200,000 | 41.60% |
| | UMB Bank, National Association | $5,000,000 | 6.67% |
| The address of each of the above participants is: |
| c/o The Depository Trust Company |
Item 13: Certain Relationships and Related Transactions, and Director Independence.
Not Applicable.
Item 14: Principal Accountant Fees and Services.
Not Applicable.
PART IV
Item 15. Exhibits, Financial Statement Schedules.
(a)(1) Not Applicable.
(a)(2) Not Applicable.
(a)(3) Not Applicable.
(b) Exhibits
| | |
Exhibit Number | | Description |
| 31.1 | | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
| | | |
| 99.1 | | Report of PricewaterhouseCoopers LLP pursuant to Section 3.06 of the Pooling and Servicing Agreement with regard to FIA Card Services, National Association (including the related assertion letter of FIA regarding its internal controls, delivered pursuant to Section 3.06 of the Pooling and Servicing Agreement). |
| | | |
| 99.2 | | Report of PricewaterhouseCoopers LLP pursuant to Section 3.06 of the Pooling and Servicing Agreement with regard to FIA Card Services, National Association (including the related assertion letter of FIA regarding its compliance with the provisions of the Pooling and Servicing Agreement, delivered pursuant to Section 3.06 thereof). |
| | | |
| 99.3 | | Servicer Compliance Statement of FIA Card Services, National Association. |
(c) Not Applicable.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| | BA Master Credit Card Trust II |
| | |
| | By: FIA Card Services, National Association, |
| | as Servicer |
| | |
| | |
| | By: /s/ Michael E. FriedlanderMichelle D. Dumont |
| | Name: Michael E. FriedlanderMichelle D. Dumont |
| | Title: Senior Vice President |
| | |
| (senior officer in charge of the servicing function) |
| |
| Date: September 28, 20102011 |
EXHIBIT INDEX
| | | |
Exhibit
Number
| | Description |
| 31.1 | | Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
| | | |
| 99.1 | | Report of PricewaterhouseCoopers LLP pursuant to Section 3.06 of the Pooling and Servicing Agreement with regard to FIA Card Services, National Association (including the related assertion letter of FIA regarding its internal controls, delivered pursuant to Section 3.06 of the Pooling and Servicing Agreement). |
| | | |
| 99.2 | | Report of PricewaterhouseCoopers LLP pursuant to Section 3.06 of the Pooling and Servicing Agreement with regard to FIA Card Services, National Association (including the related assertion letter of FIA regarding its compliance with the provisions of the Pooling and Servicing Agreement, delivered pursuant to Section 3.06 thereof). |
| | | |
| 99.3 | | Servicer Compliance Statement of FIA Card Services, National Association. |