Macy’s, Inc. and Citibank, N.A. Sixth Amendment to the Amended and Restated Credit Card Program Agreement

Frequently Asked Questions

1. Why was the amendment executed?

Prior to the execution of the new amendment, under the terms of the Program Agreement, if sales decreased by more than 34% over a twelve-month period as compared to the Benchmark Year, defined as the twelve-month period from July 2006 to June 2007 in the Program Agreement, Citibank had the ability to provide written notice to terminate the agreement prior to the end of its current term (“Adverse Sales Development”). The sales results for the company’s twelve-month period ended February 27, 2021 decreased by more than 34% as compared to the Benchmark Year and, as a result,  on June 4, 2021, the company received a written notice of termination of the Program Agreement from Citibank. Upon receipt of the written notice of termination, the company had six months to exercise, or not exercise, an option to purchase the assets of the Program Agreement, or nominate a third party to purchase such assets, and a subsequent six-month period to complete such transfer, subject to potential extensions as more fully described in the Program Agreement. However, pursuant to this new amendment, the termination notice was rescinded, and Citibank will continue as the Credit Card Program Agreement partner for Macy’s, Inc.

2. What is the term of the new amendment?

The new amendment is effective as of December 13, 2021 until March 31, 2030.


3. Other than the new agreement term, what were the changes to the agreement included in the amendment?

Overall, under this new amendment, the Program Agreement’s financial structure is not materially different from its previous terms. Changes to the Program Agreement because of this new amendment include the following, among others:

  • The Adverse Sales Development was eliminated,
  • Revision to profit share tiers,
  • Certain changes to the treatment of program expenses,
  • Addition of a letter of credit or reserve requirement if Macy’s, Inc. corporate credit ratings fall below certain levels, and
  • Specified systems changes will be implemented, and others considered.

4. Will the changes in the amendment have any impact on fiscal 2021?

The new amendment will not have a material impact on the financial results of the Credit Card Program in fiscal 2021. The amendment provides that Citibank will pay Macy’s, Inc. a signing bonus, which will be amortized over the term of the amendment and will be immaterial to any one year’s financial results.


5. Will the changes in the amendment impact credit card revenues in future years?

Yes, over the next few years, we expect credit card revenues as a percent of net sales to be slightly lower than our historical average of 3%. This outlook includes our expectation that bad debt within the credit portfolio will have a more negative impact on financial results as it returns to more historical levels (pre-pandemic) over the course of the next few years, beginning in 2022 and increasing in future years.


6. Can you expand on why you stayed with Citibank and did not transfer to another institution?

As a digitally led omnichannel retailer, we are committed to developing a robust innovation pipeline and strong digital capabilities to further deepen our engagement with customers while continually improving their shopping experience. Citibank has been a strong partner to Macy’s, Inc. for many years, and we look forward to continuing our work together based on the shared commitment to innovation and customer service excellence.




Forward-Looking Statements

All forward-looking statements are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. A detailed discussion of these factors and uncertainties is contained in the company's filings with the Securities and Exchange Commission.