Earlier this month, Capital One (COF) finalized the acquisition of HSBC's (HBC) U.S. credit card business. And within days of the deal going through, Capital One swung into action with the process of integrating the new business --announcing a reduction of nearly 1,000 jobs in the erstwhile HSBC card units.

The deal, which was announced late last year, added credit-card loans worth more than $28 billion to Capital One's balance sheet and catapulted the bank to the third position in the private-label card industry, after General Electric (GE) and Citigroup (C).

We are in the process of updating our $46 price estimate for Capital One's stock to factor in the impact of the HSBC cards acquisition.

Capital One has been bulking up its business in recent quarters through acquisitions. And the fact that many big banks -- primarily those based in Europe -- have put up many of their non-core business units for sale has given Capital One ample opportunity to shop for those that best fit its growth strategy. The bank acquired the ING Direct business in the U.S. this February, making it the sixth largest depository institution and the biggest direct bank in the country.

The acquisition of HSBC's credit card business cost Capital One around $31.3 billion. The bank willingly paid a premium of nearly $2.5 billion on the credit card portfolio, a substantial part of which consists of private-label cards -- cards issued in the names of retailers.

The acquisition does a lot of good to strengthen Capital One's presence in the growing credit card business. Also, there are various cost-saving avenues that are available to Capital One in terms of acquisition synergies. The lay-offs announced represents one of them.

A majority of the job cuts target the former HSBC processing, administrative and business ops facility in Salinas, California -- processes that can be managed through Capital One's existing resources. The Salinas operations are expected to be shuttered by next July, trimming about 870 jobs. A reduction of another 80 jobs comes from the bank's decision to exit its business in the Buffalo area.

No doubt, Capital One will be on the look-out for more cutting costs opportunities as the integration progresses and it follows through on the expense reduction plans it announced last year.

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