Bank of America has announced plans to purchase MBNA Corp for $35 billion. The acquisition will turn the financial services giant into the largest credit card issuer in the U.S.

Under the cash and stock agreement, Bank of America will pay MBNA shareholders $4.125 in cash and 0.5009 share of B of A common stock for each of share. The deal values MBNA at $27.62, a 31 percent premium over Wednesday's stock prices.

The combined companies will offer what many industry analysts call a financial super center for one stop finance shopping.

Bank of America CEO Kenneth Lewis described the "creation of the world's largest credit card providers" as a story "...about two companies with complementary strengths. The result will be the country's top retailer of financial services with the size and scale to drive distribution and marketing efficiencies."

Bank of America is the nation's third largest bank and previously ranked fourth in the credit card business.

MBNA shares rose about 25 percent following the announcement.