Genpass Joins Western Union

Western Union Financial Services, Inc., a subsidiary of First Data Corp., and Genpass Inc., owner and operator of the MoneyMaker and MONEYBELT EFT networks, announced they have reached an agreement that will enable ATMs owned and/or driven by Genpass to offer the Western Union Money Transfer service.

Genpass will join Western Union’s ATM Money Transfer Network, allowing consumers access to one of the newest ways to send and receive money, 24-hours a day, seven days a week. This agreement facilitates the continued expansion of Western Union’s ATM-based money transfer service around the country. Genpass plans to rollout money transfer capability on its own ATMs early next year.

“Interest in ATM money transfer as a value-added service is growing within the financial services industry, particularly in light of the tremendous growth we’re seeing in worldwide money transfer transactions,” said Mike Yerington, president for Western Union North America. “As the second largest ATM driver in the U.S., the addition of Genpass’ EFT Networks and ATMs to our integrated ATM and Agent money transfer network will increase consumer accessibility to Western Union’s fast, secure and reliable money transfer services.”

“Genpass is committed to offering new services that benefit our EFT network and ATM customers. Providing around the clock access to money transfers expands the functions consumers can transact at an ATM. Genpass management has a history of delivering value-added services to the consumer marketplace,” said Bipin C. Shah, president and CEO of Genpass. “It is also a terrific opportunity for our ATM partners to attract more transactions per ATM. And, given Western Union’s brand strength and market penetration, choosing them as a provider was simple.”

About Western Union ATM Money Transfer

The Western Union ATM Money Transfer service allows consumers to electronically send money at any participating ATM by simply swiping an ATM card and then selecting the money transfer option. The user is prompted to select a personal identification number (PIN) and the desired dollar amount of the transfer. The ATM provides the sender a receipt and confirmation number. To complete the money transfer, the sender relays the confirmation number and PIN to the intended recipient who can retrieve the funds from any participating ATM, or at any Western Union agent location. No bankcard is necessary to receive the funds at the ATM, and because the combination of the PIN and confirmation code is unique for every transaction, the process is safe and secure.

Unlike other person-to-person, ATM-based, money transfer systems that only allow for money transfers between ATMs, the Western Union ATM Money Transfer service (formerly known as Z-Cash) offers interoperability with Western Unions Agent network of nearly 40,000 agent locations across the U.S.

About Western Union Financial Services, Inc. and First Data

Western Union Financial Services, Inc., a subsidiary of First Data Corp. (NYSE: FDC), is a worldwide leader in consumer money transfer services. Consumers can quickly, safely and reliably transfer money at more than 117,000 Agent locations in more than 185 countries and territories. Famous for its pioneering telegraph service, the original Western Union dates back to 1851 and introduced electronic money transfer service in 1871. Western Union is celebrating its 150th anniversary in 2001. For more information, please visit the company’s Web site at [http://www.westernunion.com][1].

First Data Corp., with global headquarters in Denver, powers the global economy. Serving approximately 2.6 million merchant locations, more than 1,400 card issuers and millions of consumers, First Data makes it easier, faster and more secure for people and businesses to buy goods and services, using virtually any form of payment: credit, debit, smart card, stored-value card or check at the point-of-sale, over the Internet or by money transfer. For more information, please visit the company’s Web site at [http://www.firstdata.com][2].

About GTCR Golder Rauner, LLC, and Genpass Inc.

GTCR Golder Rauner, LLC, is a leading private equity investment firm that owns and operates Genpass Inc. Founded in 1980, GTCR pioneered the investment strategy of identifying and partnering with exceptional executives to acquire companies in fragmented and growing industries. GTCR currently manages more than $4 billion in equity capital invested in a broad range of companies and industries, including transaction processing, information technology services, financial services and marketing services.

Genpass Inc., through its subsidiary companies, is the owner and operator of the MoneyMaker(SM) and MONEY BELT(R) EFT networks. The corporate headquarters of Genpass Inc. is located in Pennsylvania with additional executive and processing headquarters in Dallas. The Genpass family of companies offers technology-based, financial transaction processing and EFT servicing solutions for financial institutions, independent sales organizations, and corporate customers. MoneyMaker is the second largest ATM driver in the U.S. with over 20,000 ATMs in all 50 states. MoneyMaker is one of the largest transaction processors in the U.S., processing over 300 million transactions annually with gateways to every major card issuer and regional network in the nation. Genpass also operates Genpass Service Solutions, the largest independent ATM servicing company in the U.S., and Genpass ATM Solutions, which aids customers in formulating strategies for ATM deployments. The Genpass companies serve more than 1000 financial services customers.

[1]: http://www.westernunion.com/
[2]: http://www.firstdata.com/

MemberWorks Cuts Jobs

MemberWorks Incorporated, a leading provider of consumer and membership services through affinity marketing and online channels, announced it is revising its fiscal 2002 revenue, earnings and operating cash flow guidance. In revising its guidance, the Company cited a recent slowdown in consumer response rates due to the difficult current economic environment.

The Company also announced several cost saving initiatives in light of increasing uncertainty both in the U.S. and abroad and expects to record a restructuring charge of approximately $7.0 million in its fiscal second quarter. These initiatives include the closing of the Company’s United Kingdom operation, reducing the capacity of its inbound call centers, and downsizing operational infrastructure throughout the Company.

These actions will result in the reduction of approximately 225 employees or 15% of its workforce. Annual savings from these measures are expected to reach approximately $9.0 million.

Gary Johnson, President and Chief Executive Officer, said “The current economic environment is difficult, and the tragic events of September 11th have affected us all. Given the uncertainty surrounding the economy, we are making structural changes to the capacity of our Company in order to provide greater flexibility in responding to changing market conditions.” Mr. Johnson continued, “We are taking these steps to ensure the long term health of our business as we remain focused on profitability and cash flow performance. The net effect of these changes for this fiscal year will be to flatten revenue growth and to increase both cash flow and EPS on a year over year comparative basis.”

MemberWorks expects to report its financial results for the first fiscal quarter prior to the market opening on October 25, 2001. Based on preliminary financial data, it expects revenue for its first quarter ended September 30, 2001 to be in the range of $118.0 to $120.0 million. Earnings per share is expected to be $0.03 to $0.05, before a one-time gain on the sale of iPlace Inc., and operating cash flow is expected to be negative $7.0 to $8.0 million before working capital and negative $11.0 to $13.0 million after working capital. Cash and equivalents are expected to be approximately $43.0 million at September 30, 2001.

Consensus estimates for the first fiscal quarter were revenues of $123.0 million, earnings per share of negative $0.01 and operating cash flow of $10.4 million before working capital and $12.4 million after working capital. Compared to fiscal 2001, revenues for the September quarter are estimated to increase 23% to 25%, excluding iPlace Inc. results. Earnings per share is expected to be positive $0.03 to $0.05 vs. a loss of $0.48 per share last year before the cumulative effect of accounting change. Operating cash flow after working capital is expected to be negative $11.0 to $13.0 million vs. negative $14.0 million in last year’s first fiscal quarter.

The Company has also revised its outlook for the full fiscal year ended June 30, 2002. MemberWorks expects revenues to be $420.0 to $430.0 million. Earnings per share is expected to be $1.15 to $1.25 excluding one-time items. Operating cash flow is expected to be $16.0 to $18.0 million before working capital and $25.0 to $28.0 million after working capital.

MemberWorks’ previous guidance for the full fiscal year was revenues of $521.0 million, earnings per share of $0.72, fully tax-effected, and operating cash flow of $50.0 million before working capital and $70.0 million after working capital.

Compared to fiscal 2001, revenues for the full year are expected to be 3% lower, excluding iPlace results. Earnings per share are estimated to be positive $1.15 to $1.25 vs. negative $1.75 last year excluding the cumulative effect of accounting change. Operating cash flow after working capital is expected to be $25.0 to $28.0 million vs. $13.0 million last year. Johnson concluded, “Our financial performance for the rest of this year continues to show improved profitability and cash flow over last year. We are confident that the actions taken will make MemberWorks a stronger, more focused company.”

Headquartered in Stamford, Conn., MemberWorks is a leader in bringing value to consumers by designing innovative membership programs that offer services and discounts on everyday needs in healthcare, personal finance, insurance, travel, entertainment, computing, fashion and personal security. As of June 30, 2001, 7.9 million members were enrolled in MemberWorks programs, gaining convenient access to thousands of service providers and vendors. MemberWorks is the trusted marketing partner of leading consumer-driven organizations and offers them effective tools to enhance their market presence, to strengthen customer affinity and to generate additional revenue.

EDS Signs Wireless Deal

EDS announced the signing of a five-year, $18 million contract with Houston-based Commerciant to provide transaction processing services for Commerciant’s wireless terminals used by mobile merchants.

Commerciant targets the $470 billion “mobile business to consumer” market with highly secure, comprehensive transaction management solutions capable of supporting all non-cash payments in a mobile, wireless environment. The company’s flagship MobilScape hardware is the only wireless payments terminal with integrated credit card and check scanning capability, making wireless check conversion a reality.

Mobile businesses provide services and products to customers outside a fixed physical location, and include businesses such as food delivery, plumbing, heating, air conditioning, appliance and other home services, and in-home sales. Residential services represent the largest segment within this market.

Under the contract, EDS will provide real-time, point-of-sale, credit card acceptance and processing for transactions from Commerciant business customers using hand held devices to finalize sales. EDS also will provide electronic check clearing services for Commerciant’s MobilScape check processing system that transforms paper checks into electronic check payments by scanning checks, digitizing customers’ signatures and printing customer receipts at the point of sale. This cost-saving service allows mobile businesses to gain access to funds much faster and detect fraud earlier, a critical factor since mobile fleets seldom return to a central location to deposit and reconcile transactions for each day’s business.

“This agreement reflects an expanded use of EDS’ core transaction processing capabilities. Our point-of-sale services are being used to eliminate the disadvantages under which mobile businesses have long operated,” said Vinnie Calo, director of EDS’ Card Processing Services group. “Mobile merchants previously lacked the ability to verify checks in the field, and they pay premiums for credit card transactions called into a central location for authorization.

“EDS and Commerciant are leveling the playing field and introducing the same efficiencies to field sales and service operations that traditional fixed location businesses have experienced.”

In addition to transaction processing services, EDS will provide device management services for Commerciant and its business customers. These comprehensive services include device inventory management and tracking, as well as application downloading, device deployment and depot maintenance services. The services are supported through a 24×7 EDS client assistance center.

“EDS and Commerciant are bringing valuable services to on-the-road businesses that have a high demand for advanced, easy-to-use, low cost technology that makes them more efficient and productive,” said Commerciant Chief Executive Officer Elliot Sokolow. “Commerciant and EDS provide an innovative business model which eliminates the traditional cost barriers that made use of real-time payment processing prohibitive for many mobile merchants. There has been only fractional mobile device penetration in this market and by offering mobile point-of-sale transaction services that encompass all non-cash payments, as well as other field data service needs, we see a significant growth opportunity.”

About Commerciant

Commerciant is the single source wireless solutions provider in the payments and mobile business data service industry. Commerciant provides authorization, settlement, wireless access, and its low cost, hand held MobilScape(TM) terminal capable of performing remote credit card and check processing and other mobile business data services under a single contract. Learn more at [http://www.commerciant.com][1].

About EDS

EDS, the leading global services company, provides strategy, implementation and hosting for clients managing the business and technology complexities of the digital economy. EDS brings together the world’s best technologies to address critical client business imperatives. It helps clients eliminate boundaries, collaborate in new ways, establish their customers’ trust and continuously seek improvement. EDS, with its management consulting subsidiary, A.T. Kearney, serves the world’s leading companies and governments in 55 countries. EDS reported revenues of $19.2 billion in 2000. The company’s stock is traded on the New York Stock Exchange and the London Stock Exchange. Learn more at [http://www.eds.com][2].

[1]: http://www.commerciant.com/
[2]: http://www.eds.com/

BANKING WOES

The ongoing crisis in Argentina has led observers to focus more closely on
what has long been considered one of the strengths of the Argentine economy,
its banking system. In an earlier comment (`Fitch Comments on Argentine Banking
System Amid Tumultuous Markets’, July 31, 2001), Fitch, the international
rating agency, had reviewed the many reforms and the consolidation that
contributed to a substantial strengthening of the Argentine banking system
since the severe pressures it felt in the wake of the 1994 Mexican devaluation.
In a subsequent comment issued today, Fitch has evaluated various scenarios for
the Argentine banking system over the coming months as the economy struggles to
return to sustainable growth under a heavy debt burden.

While banking sector reforms enacted over the latter half of the 1990s and
increased foreign participation have undoubtedly improved the system’s
strength, pressure has risen over the past year in parallel with deteriorating
sovereign creditworthiness. Argentina’s foreign currency credit rating was
downgraded to `B-`, Rating Outlook Negative in July and Fitch’s international
ratings on Argentine banks have also moved downward over the course of the last
year. Among these ratings are still strong support ratings for the subsidiaries
of major foreign banks.

Significantly, the banking system’s single largest exposure is to its own
government, and this has been the principal source of balance sheet expansion
during the prolonged recession. Thus, growing fears of sovereign default have
been accompanied by significant deposit flight – down 15% since their peak
earlier this year – funded by the outflow of an important portion of previously
comfortable liquidity reserves. Although deposit flight has been stemmed since
the announcement of enhanced financial support from the IMF in August, a large
portion of which was earmarked to restore banking system liquidity, the
potential for negative events to trigger further pressure on deposits still
exists.

As was the case in the 1995 Tequila Crisis, anecdotal evidence points to
institutional investors’ withdrawal of funds from the banking system as the
primary reason for the deposit fall. However, renewed falls are quite likely to
result in deposit flight quickly spreading to retail depositors, potentially
leading to a rapid snowballing which would renew the drain on liquidity. This
could force banks to look to their less liquid assets (loan and securities
portfolios) for the liquidity necessary to honor potential deposit withdrawals.
It is these very assets that have come most under stress as a result of
continuing economic stagnation.

The two asset classes most under stress in the current environment are:
–Credit extended to the Argentine national and provincial governments; and,
–Private sector loans in largely stagnant loan portfolios.

Of most immediate concern is exposure to the public sector, estimated at 174%
of equity for the system as a whole. While government securities are a
relatively small proportion of total bank assets, total public sector exposure
also includes loans to the provinces secured by future tax flows and is a much
greater proportion of balance sheets. Even for the most conservative banks it
exceeds current levels of equity and is particularly pronounced for banks in
the public sector, at 271% of equity, compared with 148% for private banks.
Banks would be directly affected by any restructuring of existing debt, with
any potential reduction (or `haircut’) likely to absorb an equivalent part of
banks’ equity bases. Lengthy grace periods on new classes of government debt
would reduce banks’ cash flows, and negatively affect the ultimate liquidity of
such securities. Fitch believes such events may lead to continued regulatory
forbearance as to bank accounting, which could hide the potentially significant
reduction in the cash flows available to the banks and in the realizable value
of these assets. Much of the public sector exposure in bank portfolios is in
the form of advances made to provinces against the flow of tax payments to the
provinces, and a reduction of such flows, as currently being contemplated, will
certainly mean, at least, a significant rescheduling of current terms on these
exposures; again, potential losses in value of these exposures could translate
to hits against current equity bases.

Adding to the potential pressure on the banks from their public sector
exposures is what will certainly be pressure on the asset quality of existing
loan and contingent exposures to the private sector, as the prolonged recession
is made sharper by recent events, and the return to sustainable growth appears
to be still some time off. Published figures through 30 June, 2001, have not
shown evidence of substantial credit quality deterioration, with loan
portfolios already tested and seasoned by the prolonged recession. However,
Fitch expects pressure on credit quality to persist, as evidenced by some
well-publicized bankruptcies among higher profile corporate credits.

The precise behavior of impaired loans in coming months is impossible to
predict. However, recent banking crises in Mexico in 1995 and in Asia in 1997-9
give some indication of the potential for impaired financing to increase. Fitch
has therefore analyzed the impact of a doubling and tripling of impaired loans
as a way of illustrating the potential stress on the system. A doubling of
impaired financing would take them to 25% of total financing, around the level
reached in Asian countries less badly affected by the Asian crisis, such as
Malaysia. A tripling would represent a more serious outturn, such as
experienced by Thailand. As regards the public sector banks, were gross
impaired financing to double (x2), that sector’s gross exposure would equate to
US$12.5 billion (EUR13.7 billion), or 295% of equity (compared to 87% for
private banks and 136% for the system). A tripling of gross impaired financing
would increase the public banks’ gross impaired financing to 442% of equity
(compared to 130% for private banks and 204% for the system). The public banks
appear to have little cushion to absorb an inevitable increase in problem
assets. The private sector banks, which have generally been aggressive in
maintaining or increasing reserve levels and in attacking their stock of
impaired loans with heavy chargeoffs, appear to be much better positioned to
absorb substantial increases in impaired credits in the private sector,
although a haircut to government exposure combined with a substantial increase
in impaired loans could also lead to significant hits to equity
Fitch points out that the impact of a devaluation of the Argentine peso would
be even more damaging. Although such an option has been ruled out by the
government and will be strongly resisted, such an outcome cannot be entirely
discounted. Any devaluation would likely be substantial, and given that nearly
75% of total loans are extended in US dollars, with over 90% of the systems’
portfolio of securities also denominated in dollars, the effects of a
devaluation would be very damaging and place further pressure on an already
strained banking system.

AmEx & Sept. 11th

American Express announced Thursday it has added ‘The September 11th Fund’ as a new charity partner to its ‘Membership Rewards’ program. AmEx said is also matching all charitable point redemptions made by ‘Membership Rewards’ program enrollees through Dec. 31, up to a total of $200,000. For example, for every 1,000 ‘Membership Rewards’ points donated, a $10 contribution will be made. American Express and its employees are also contributing to relief efforts through the ‘American Express World Trade Center Disaster Relief Fund’ which includes an initial $1 million contribution from the American Express Foundation, which will also match the gifts of employees, financial advisors and retiree donations. In addition, American Express is contributing $1 million to the families of American Express employees who were lost in 1 World Trade Center.

FCNB & CardSite

Incurrent Solutions, Inc., the leading provider of on-line cardmember self-service solutions to credit card issuers and transaction processors, announced that First Consumers National Bank, a subsidiary of Spiegel, Inc., is now utilizing Incurrent’s CardSite platform to deliver online customer self-service at [http://www.fcnb.com][1]. Managing receivables of over $3.3 billion, FCNB is the 24th largest bank credit card issuer in the nation(1) and is the nation’s tenth largest issuer of private-label credit cards(2). FCNB provides credit card services to a nationwide customer base of secured and unsecured MasterCard and Visa accounts, as well as to Spiegel, Eddie Bauer, Newport News, and Crate and Barrel customers.

“Our strategic objectives focus on providing diverse, value-added products to our customers that bring convenience to the shopping process,” said Greg Aube, FCNB’s President and CEO. “We offer a wide variety of choices to meet the specific needs of our customers and now, by teaming up with Incurrent, we are able to offer a higher level of convenience to our customers through the Internet.”

FCNB’s CardSite customer self-service solution gives its bankcard and private-label credit customers full access to their balance information in real time through the FCNB Web site ([www.fcnb.com][2]). In addition to being able to view their transaction history online, customers also have the ability to perform sort and search functions on their transactions. Some other self-service features include online address changes and requests for credit limit increases.

“Incurrent is delighted to play a key role in creating FCNB’s online customer self-service solution,” said Loren Hulber, Incurrent’s President and CEO. “FCNB is an unique financial institution that serves a diverse mix of bankcard and private-label credit customers. Working together, we have created a content-rich Web site that will provide FCNB’s customers with a convenient choice while helping FCNB reduce its customer service costs.”

FCNB Chooses CardSite for Quick Deployment and Advanced Technology

Before selecting CardSite as its customer self-service platform, FCNB examined several vendors’ products as well as the possibility of building in-house technology. “Our decision to use Incurrent Solutions was based upon its business model of offering a complete turnkey operation. In addition, Incurrent has a solid understanding of bank requirements and it offered flexibility in meeting our needs,” said Don Sasaki, Vice President of the Internet Group for FCNB. “We began working with Incurrent in March. By August, we were up and running with a redesigned site, complete with new content and functionality. With Incurrent, we’re dealing with a highly experienced group that can provide the latest technology. This decision also gave us the ability to introduce new customer self-service functionality without having to buy equipment and hire and train new personnel to manage it.”

CardSite provides FCNB bankcard and private-label credit customers with the ability to:

— View transaction detail with up to twenty-four months of account history — Statement-sort by expense categories, merchant, or description with printable reports — Query for individual transactions or other transaction history — View charts of spending patterns — Set up e-mail alerts for designated account conditions or events — Submit a change of address online — Submit an online request for a credit limit increase

About Incurrent Solutions

Founded in 1997, Incurrent Solutions ([www.incurrent.com][3]) provides advanced online cardmember self-service solutions to credit card issuing banks, retailers, and transaction processors. Incurrent’s clients include Sears, MBNA, Fleet Credit Card Services, NextCard, Metris Companies, Certegy, Fiserv, and other major card issuers. The volume of cardholder accounts serviced on Incurrent’s CardSite(TM) platform has grown from 15 to 100 million in less than year, reflecting a rapidly growing card industry demand for the valuable customer service extension CardSite provides to issuers.

CardSite is a cutting-edge, e-service solution that greatly enhances the cardholder’s online service experience, resulting in increased retention at a cost significantly lower than traditional customer interaction methods. Cardholders enjoy access to real-time account information, statements, bill payment, secure e-mail, reports, searches, and other service-enhancing tools.

About FCNB and The Spiegel Group

The Spiegel Group is a leading international specialty retailer marketing fashionable apparel and home furnishings to customers through catalogs, more than 580 specialty retail and outlet stores and eight e-commerce sites, including eddiebauer.com, newport-news.com and spiegel.com. The Spiegel Group’s businesses include Eddie Bauer, Newport News, Spiegel and First Consumers National Bank.

A national bank specializing in the issuance of credit cards, First Consumers National Bank (FCNB) plays a dual role within The Spiegel Group, supporting the marketing efforts of the Group’s merchant companies with private-label credit programs and offering unique bankcard credit programs that target under-served market niches. FCNB’s Web site address is [www.fcnb.com][4].

[1]: http://www.fcnb.com/
[2]: http://www.fcnb.com/
[3]: http://www.incurrent.com/
[4]: http://www.fcnb.com/

US CARD ORDER

Oberthur Card Systems received its first order to
provide smart Visa cards for Providian Financial Corporation. “Providian,
which issued its one millionth smart Visa card in June 2001, is one of the
first banks in the United States to issue smart Visa cards.

“Providian is a clear leader in the Smart Visa push and is building strong
ties to its existing customers while paving a road to a new generation of Visa
customers,” noted Philippe Tartavull, president & CEO of the American division
of Oberthur Card Systems. “Oberthur has extensive experience with large scale
deployment of smart cards and is very pleased to become one of the suppliers
who will assist Providian in advancing smart cards in the U.S.”

The smart Visa card enables Visa financial institutions to combine the
purchasing power of traditional payment cards with smart chip technology to
offer added security, utility and convenience to consumers. With the growth
in e-commerce, new and technologically-enhanced payment products such as the
Smart Visa card will meet the evolving needs of consumers for greater
convenience, control and highly personalized services. Visa projects there
will be about seven million ‘smart Visa’ cardsinforce by year’s end among all
of its current issuers.

“As one of the country’s leading issuers of Visa cards, we are glad to
welcome Oberthur on board the Providian smart Visa program,” said Elizabeth
Tse, senior vice president at Providian. “Their experience and breadth of
knowledge in the financial services market was a key factor in our decision to
work with Oberthur.”

About Oberthur Card Systems

Oberthur Card Systems (Paris Stock Exchange – Code SICOVAM 12413), a
global leader and the innovator in the smart card industry, is shaping the
future by offering the ultimate in SIM, WAP, 3G (IMT-2000/UMTS), e-wallet
technologies & Internet-based card management services coupled with a firm
commitment to open standards.

Championing EMV migration, Oberthur is the world’s #1 supplier of
MasterCard and Visa cards, #1 in banking, e-commerce, m-commerce and pay-TV,
Oberthur is also the #1 in Java(TM) and GSM technologies.

Oberthur Card Systems has an international reach ensured by 30 sales
offices and 20 manufacturing sites across the five continents. Oberthur Card
Systems had sales of 451.1 million Euros in 2000.

About Providian Financial

Winner of the 2001 Rochester Institute of Technology/USA Today Quality Cup
for excellence in customer service, San Francisco-based Providian Financial
(http://www.providian.com) is a leading provider of
lending and deposit products to
customers throughout the U.S., and offers credit cards and deposit products in
the U.K. and Argentina. Providian Financial has been named one of America’s
Most Admired Companies in a survey by Fortune magazine, one of the nation’s
top financial institutions by U.S. Banker magazine, and one of the most
technologically innovative companies in the U.S. by Information Week magazine.
The Company has more than $36 billion in assets under management and over
18 million customer accounts.

Cap One Biz Awards

Capital One Financial Corporation announced it has been recognized as one of the most innovative users of information technology by InformationWeek magazine for the fourth year in a row and by Darwin magazine in the debut of its “Fittest 50.”

“These awards recognize Capital One’s leadership position in applying technology to marketing financial services,” said Nigel Morris, President and COO. “It’s a testament to Capital One’s entrepreneurial culture, created to foster continuous innovation by our 20,000 associates.”

The 13th annual InformationWeek 500 lists the most innovative users of information technology — companies that are considered masters in combining information technology and business savvy to build profitable and successful customer relationships. InformationWeek ranks companies on both the size and complexity of installed information technologies, as well as on the tangible business benefits created by technology.

Darwin’s Fittest 50 are chosen based on their ability to use IT to adapt, survive and thrive in a changing economy. Nominations by a panel of 15 experts, including academics and business consultants, as well as Darwin editorial staff, were narrowed down to the top 50 after extensive research by Darwin editorial staff.

“Capital One’s IT work is driven by our desire to deliver superior products, services and value for our 38 million customers,” said Marge Connelly, Executive VP, Domestic Card Operations and IT Operations. “This makes the Information Week and Darwin recognitions even more gratifying.”

Laura Olle, Senior VP Systems Development and Senior Business Information Officer, said: “Capital One’s culture of a true partnership between IT and the business means we have the in-house expertise to pull together in a spirit of collaboration and pursuit of a common goal.”

Capital One was recently recognized by another measure of information technology innovation — CIO 100, CIO magazine’s yearly list of the top 100 most innovative companies in the world.

Headquartered in Falls Church, Virginia, Capital One Financial Corporation ([http://www.capitalone.com][1] ) is a holding company whose principal subsidiaries, Capital One Bank and Capital One, F.S.B., offer consumer lending products. Capital One’s subsidiaries collectively had 38.1 million customers and $35.3 billion in managed loans outstanding as of June 30, 2001. Capital One, a Fortune 500 company, is one of the largest providers of MasterCard and Visa credit cards in the world. Capital One trades on the New York Stock Exchange under the symbol “COF” and is included in the S&P 500 index.

[1]: http://www.capitalone.com/

MASTERCARD AOL

AOL Argentina, a subsidiary of America Online Latin America, and
MasterCard, one of the leading payment companies in Latin America, announced an
innovative, joint marketing and advertising agreement. The program features a
unique AOL member acquisition initiative tied to the World Cup and
Argentina’s National Soccer Team.

Argentine consumers who register for the America Online Argentina service using
their MasterCard cards will qualify for special prizes and awards, including
personal visits with members of Argentina’s National Soccer Team. The agreement
provides for the promotion of America Online Argentina in MasterCard’s member
publications and MasterCard will also advertise on the America Online Argentina
service.

The MasterCard agreement builds upon AOL Latin America’s growing relationships
with top financial institutions and credit card companies throughout the
region. AOL Latin America has a successful strategic alliance with Banco Itau
of Brazil, with whom it operates a fast-growing, co-branded America Online
Brazil service that provides unique online banking features and functionality.
In August, AOL Brazil announced a co-branded credit card with Credicard, the
largest credit card company in Brazil. AOL Latin America also has developed
strong relationships with credit card companies and financial institutions in
Mexico such as Banorte.

Charles Herington, President and CEO of AOL Latin America, said: “We are very
happy to be working with MasterCard, one of the most well-known and respected
brands in the region. This marketing program provides yet another important way
for us to invite Argentine consumers to join the more than 1 million members
throughout Latin America who are enjoying the ease of use and convenience of
the AOL interactive experience. It also builds on our efforts to work with the
top financial institutions in Latin America to aggressively market our services
to consumers interested in embracing the power of the Internet.”

Osvaldo Setuain, President and CEO of AOL Argentina, said: “Argentine consumers
are increasingly making the Internet and America Online Argentina a central
part of their everyday lives. This program with MasterCard builds upon not only
our members’ love of the interactive experience, but their tremendous
enthusiasm for soccer, the World Cup tournament and their national team. We
look forward to strong results from this program, and are quite pleased to have
this opportunity to work with MasterCard, which has become an increasingly
important part of the Argentine financial landscape.”

Jean Rozwadowski, President of MasterCard for the Latin America and Caribbean
Region, said: “MasterCard and AOL Argentina together represent a powerful
alliance. We could not have found a better partner to market our credit cards
to the fast-growing online audience. AOL has rapidly become the premier online
brand in Latin America, and we are looking to leverage that strength in the
Argentine marketplace to continue building our own community of cardholders.
The ability to combine this effort with our unique World Cup promotion only
helps make this offering even more compelling to consumers, and will allow us
to reinforce with them MasterCard’s unparalleled reputation for excellence.”

About MasterCard

MasterCard International has a comprehensive portfolio of well-known, widely
accepted payment brands including MasterCarda, Cirrusa and Maestroa. More than
1.7 billion MasterCard, Cirrus and Maestro logos are present on credit, charge
and debit cards in circulation today. An association comprised of more than
20,000 member financial institutions, MasterCard serves consumers and
businesses, both large and small, in 210 countries and territories. MasterCard
is a leader in quality and innovation, offering a wide range of payment
solutions in the virtual and traditional worlds. MasterCard’s award-winning
Pricelessa advertising campaign is now seen in 80 countries and in more than 36
languages, giving the MasterCard brand a truly global reach and scope. With
more than 21 million acceptance locations, no card is accepted in more places
and by more merchants than the MasterCard Card. In 2000, gross dollar volume
exceeded US $857 billion. MasterCard can be reached through its World Wide Web
site at
http://www.mastercard.com.

About America Online Argentina

AOL Argentina SRL, is a subsidiary of America Online Latin America, Inc.
(NASDAQ:AOLA), a joint venture formed in 1998 by America Online, Inc., a wholly
owned subsidiary of AOL Time Warner, Inc. (NYSE: AOL), and the Cisneros Group
of Companies. With over 31 million members, America Online is the world leader
in interactive services, and the Cisneros Group is one of the leading media
groups in the Americas. Based in Buenos Aires, AOL Argentina was formed to
launch and operate the America Online Argentina service. In addition to AOL
Argentina’s direct mail and other marketing channels, consumers can obtain
America Online Argentina software free of charge by calling the toll free
number 0-800-2222-AOL (265) or by downloading it at America Online Argentina’s
Web site, www.americaonline.com.ar. America
Online Argentina is available via
local access numbers in Capital Federal and Gran Buenos Aires, Pilar, Cordoba,
Mendoza, Rosario, Mar del Plata, San Luis, Villa Mercedes, Salta, Neuquen,
Santa Fe, La Plata, Bariloche, Parana, Rio IV, Corrientes, Resistencia and
Tucuman.

About AOL Latin America

America Online Latin America, Inc. (NASDAQ: AOLA) is the exclusive provider of
AOL-branded services in Latin America and has quickly become one of the leading
Internet and interactive services providers in the region. AOL Latin America
launched its first service, America Online Brazil, in November 1999, and began
as a joint venture of America Online, Inc., a wholly owned subsidiary of AOL
Time Warner Inc. (NYSE: AOL), and the Cisneros Group of Companies. Banco Itau,
a leading Brazilian bank, is also a minority stockholder of AOL Latin America.
The Company combines the technology, brand name, infrastructure and
relationships of AOL, the world’s leader in branded interactive services, with
the relationships, regional experience and extensive media assets of the
Cisneros Group of Companies, one of the leading media groups in the Americas.
The Company currently operates services in Brazil, Mexico and Argentina and
serves members of the AOL-branded service in Puerto Rico. It also operates a
regional portal accessible at www.aola.com. AOL’s 31
million members worldwide
can access content and offerings from AOL Latin America through the
International Channels on their local AOL services.

SCA Names Chairman

The Smart Card Alliance announced the election of its 2002 Executive Board of Directors. The seven member Executive Board was elected by the Alliance’s Board of Directors at their Annual Meeting in Tysons Corner, Virginia. The Executive Board will lead and direct Alliance activities for the year ahead.

Paul Beverly from SchlumbergerSema was elected Chairman of the Alliance. Mr. Beverly, Vice President for Smart Cards at SchlumbergerSema in North America, has led a global career in marketing, sales, and general management during his 16-year tenure at Schlumberger.

“I’m looking forward to continuing to build on the strong progress that the Alliance has made. During its first year of existence, the Alliance has completed many important projects, including establishing a baseline of smart card usage in the US and Canada that can be used to measure future market growth,” said Mr. Beverly. “I look forward to working with our Board and our membership to expand on our efforts and articulate the strong business case for smart card programs in the year ahead.”

The new Executive Board also includes:

* Vice-Chairman, Bill Randle, Executive Vice President of Huntington Bank

* Technology Vice-Chair, Michael Weekes, Principal for Business Development for IBM’s Global Smart Card Center of Competency

* Treasurer, Bob Wilberger, Director of Smart Card Initiatives, at Northrop Grumman Information Technology

* Assistant Treasurer, Sandy Morris, Vice President of Member Development at MasterCard

* Secretary, Kevin Gillick, Head of Corporate Marketing at DataCard

* Assistant Secretary, Gilles Lisimaque, Senior Vice President at Gemplus

The Board’s priorities for 2002 include: addressing growing public security and privacy concerns, continued cross-industry discussions on technology standards, and other activities designed to promote the adoption of smart cards in the United States.

Last week the Alliance named five new members to its current 25 member Board:

* David Bonalle, Vice President and General Manager of Advanced Payments Programs, at American Express

* Thierry Burgess, Executive Vice President of Sales and Marketing, at Oberthur Card Systems

* Alison Colquhoun, Vice President of Smart Card Business Development, at First Data Resources

* Jennifer Spade, Managing Director for e-Solutions IP/Hosting Sales, at WorldCom

* Guy Tallent, President and CEO of Identrus

Kirk Brafford Vice President and Principal Consultant at Xansa was elected as the Auditing Observing Director on the Board.

“Each of these individuals is a leader in their field and brings a wealth of experience to our organization. Their contributions will be key to Alliance efforts as smart cards continue to gain momentum in the United States,” said Alliance President and CEO, Donna Farmer.

The announcement was made at the Smart Card Alliance’s Annual Meeting, in McLean, VA. The Meeting brings together hundreds of smart card industry leaders for three days of education and conference programs focused on the crucial opportunities and obstacles facing businesses, government and individuals in this new era of digital trust.

About the Smart Card Alliance

The Smart Card Alliance is a not-for profit, multi-industry association of over 185 member firms working to accelerate the widespread acceptance of multiple application smart card technology. Through specific projects such as education programs, market research, advocacy, industry relations, and open forums the Alliance keeps its members connected to industry leaders and innovative thought. The Alliance also is the single industry voice for smart cards, leading industry discussion on the impact and value of smart cards in the U.S. More information about the Alliance is available at [http://www.smartcardalliance.org][1].

[1]: http://www.smartcardalliance.org/

SBM BASE24

ACI Worldwide, a
leading international provider of enterprise e-payment solutions, announces the
licensing of its BASE24 e-payment processing software to State Bank of
Mauritius Limited, winner of the 2001 Bank of the Year Award for
Mauritius and one of the world’s top 1000 banks. SBM will use BASE24 to
authorize, route and switch both ATM and POS transactions and to meet
processing requirements for EMV (Europay, MasterCard and Visa) smart card
transactions.

SBM’s decision to select BASE24 was prompted by a number of key requirements,
including the need for a scalable solution to meet aggressive transaction
growth objectives, the bank’s need to support multiple delivery channels and
devices, and SBM’s need to meet mandated dates for EMV acquiring and issuing.
BASE24 will replace the bank’s existing processing system, which does not
support EMV.

“We have a reputation as a leader in harnessing the capabilities of information
technologies to improve our service to customers and contribute to the bottom
line,” said Sailesh Sewpaul, team leader of Online Services for SBM. “Our
decision to invest in ACI technology is no exception. ACI is the recognized
leader in consumer payments software, and their BASE24 system meets our current
requirements–while providing the flexibility to enhance our service offerings
in the future.”

In addition to helping SBM meet EMV requirements, the bank will use BASE24 to
integrate its ATM and POS processing operation. The bank processes an average
of 650,000 ATM and 100,000 POS transactions monthly. SBM will consolidate all
of its offshore e-payment processing activities in India, Madagascar and
Rodriguez Island to its central hub in Mauritius.
BASE24 supports multiple delivery channels, from the traditional–ATM and
POS–to the emerging–Internet and mobile. It also supports all card types,
including credit, debit and smart cards and interfaces with global credit and
debit networks.

“Our goal is to assist our customers as they provide new and innovative
services to consumers,” said Jeremy Wilmot, managing director of ACI
Worldwide’s sub-Saharan operation headquartered in South Africa. “With BASE24,
SBM can address a wide range of processing needs for its e-payment operation,
including multi-currency, smart cards and e-commerce, all on a platform that is
the world leader in offering a reliable and scalable transaction
infrastructure.”

BASE24 is used by more than 340 ACI customers around the world to manage
devices, route and switch transactions, and provide authorization support for
high-volume payments processing. The software operates on Compaq NonStop
Himalaya systems to provide 24/7 support for ATM and POS networks, manned
teller systems, telephone banking, mobile commerce, and Internet banking and
commerce.

About State Bank of Mauritius

State Bank of Mauritius (SBM) was founded in 1973 and is the largest company in
Mauritius as measured by market capitalization, commanding just under 27
percent of market share in domestic commercial banking business. In the
domestic market, SBM has a leading position in information technology and the
lowest cost-to-income ratio in the industry. SBM’s delivery network includes 52
branches and counters, 80 ATMs, and 787 point-of-sale merchant terminals
serving over 380,000 individuals and business customers. Apart from commercial
banking, SBM through its subsidiaries and associates also offers financial
leasing, investment banking, fiduciary, stock broking and asset management
services.

The Bank opened its first overseas branch in Mumbai (India) in 1994 and has
since then opened two additional branches, one in Chennai and one in Hyderabad.
In 1998, the bank started operations in Madagascar through its subsidiary bank,
Banque SBM Madagascar. The overseas operations focus mainly on corporate
banking, trade finance, correspondent banking and treasury services to business
customers.

The Banker recently named SBM its 2001 Bank of the Year for Mauritius. The
award reflects outstanding quality and innovation in the financial world, and
the 106 individual country winners represent the cream of the global banking
community.

About ACI Worldwide

Every second of every day, consumers are initiating electronic payment
transactions–getting cash at ATMs, using debit and credit cards to make
purchases in stores and on the Internet, banking by phone and PC, paying bills
online. Twenty billion times a year, ACI software is used to process these
transactions, powering the world’s online payment systems. ACI was founded in
1975 and pioneered the development of applications and networking software for
online transaction processing. Today more than 530 customers in 79 countries
use ACI supplied software. Visit ACI Worldwide on the Internet at
www.aciworldwide.com.

FraudBAN Launched

Thomson Financial Publishing, a unit of Thomson Corp., and the Western Payments Alliance, one of the nation’s largest regional payments organizations, launched FraudBAN, the first online, anti-fraud network for financial institutions. Addressing a problem that costs financial institutions more than $650 million a year, FraudBAN ([http://www.fraudban.com][1]) is a nationwide information clearinghouse that facilitates real-time data sharing among banks, thrifts and credit unions to thwart check-kiting and other kinds of white collar crime. Perpetrators of fraud frequently use similar phony identification and account information at multiple institutions. Until FraudBAN there has been no commercially available, anti-fraud service for financial institutions.

“FraudBAN’s ability to detect and prevent fraud represents one of the most significant breakthroughs in the war on check and financial fraud in the past decade,” said Glenn Gottfried, Managing Director, Thomson Financial Publishing. “FraudBAN leverages the Internet to create a nationwide clearinghouse accessible to every financial institution any time of the day or night. FraudBAN puts criminals on notice that it will be harder to commit fraud because there is now a powerful new tool to combat fraud through coordinated and immediate action among financial institutions.”

Said CEO Gerard F. Milano of the Western Payments Alliance: “Payments fraud is not the work of small-time crooks, but rather the province of sophisticated criminals who use the proceeds to finance everything from violent crime to terrorism. At a time of heightened security following the events of Sept. 11, FraudBAN strengthens the country’s financial system by enabling institutions to work cooperatively with law enforcement officials to proactively stop fraud.”

Immediate Success For FraudBAN

WesPay and Thomson Financial jointly developed the FraudBAN platform in the WesPay service area over the past two years. With limited participation and utilizing a prototype system, FraudBAN has achieved significant early success. In its initial rollout, FraudBAN identified a large check-cashing ring perpetrated at two financial institutions. The ring used legitimate consumer checks — lost, stolen or discarded check stock — and criminals impersonated bank customers. Check amounts were usually relatively small and under the review thresholds for many institutions. Four suspects were jailed in connection with the case, and the ring has ceased its activity. In addition, more than 4,300 counterfeit checks totaling $21.6 million were attempted against those institutions during that period. The pilot resulted in crime reports being filed with 29 police departments, three sheriff’s departments, and two with federal law enforcement officials. FraudBAN greatly reduces the time and effort necessary for law-enforcement and financial institutions to bring a case to prosecution.

Fraud committed in WesPay’s service area is part of a growing, nationwide problem. According to American Banker, overall fraud at financial institutions rose 32 percent from 1997 to 1999. The American Bankers Association, in its Check Fraud Survey Report in 2000, stated that more than $2.2 billion worth of check fraud was attempted against financial institutions in 1999; actual fraud losses were $679 million.

How FraudBAN Works

To participate in FraudBAN, financial institutions submit payments fraud activity into a secure online central repository. Check, wire transfer, ACH and credit card fraud activity are eligible for reporting. Direct links to payments fraud databases in larger institutions are anticipated. When fraud data is transmitted, FraudBAN searches for matches of names, addresses, account numbers and IDs used in other payments frauds.

Once a confirmed match occurs in the database, FraudBAN automatically sends an electronic alert to participating financial institutions, which then take defensive action. Joint notices to law enforcement on behalf of multiple victim institutions are also prepared. FraudBAN’s ability to aggregate information quickly allows member financial institutions to work together to build a strong case for joint prosecution with law enforcement. Only those institutions providing data to FraudBAN have the opportunity to share information provided by other financial institutions.

Previously a regional service only, FraudBAN is being rolled out by Thomson Financial Publishing to any financial institution across the country. WesPay encourages all members to participate and will automatically enroll members with less than $100 million in deposits in the service. WesPay has more than 1,000 member financial institutions.

Given FraudBAN’s success thus far and increased industry attention to fraud losses, Thomson Financial Publishing expects that more than 1,000 financial institutions will join the network in the next 12 months.

“FraudBAN is a next-generation solution that uses the Internet, as well as the cooperative spirit of financial institutions to crack down on thieves,” Gottfried said. “The greater the participation from financial institutions, the greater the value to every single bank, thrift and credit union in the country. Working together, we can significantly reduce fraud through FraudBAN.”

About WesPay

The Western Payments Alliance is one of the nation’s largest regional payment associations, with more than 1,100 members in the western U.S. and Pacific region. The Western Payments Alliance serves as a cooperative, non-profit organization enabling member financial institutions to efficiently process paper-based and electronic financial transactions. Each day, WesPay collects and clears more than five million checks totaling $7 billion in value. As a NACHA member, the Western Payments Alliance also acts as the rulemaking authority governing member transactions flowing through the Automated Clearing House (ACH). For more information, call 415/433-1230, or visit [http://www.wespay.org][2].

About Thomson Financial Publishing:

Thomson Financial Publishing (TFP), a division of Thomson Financial’s Banking, Insurance & E-Commerce Group, is a leading provider of regulatory compliance solutions to financial institutions worldwide. TFP products ensure compliance with various regulatory agencies, including the U.S. Treasury’s Office of Foreign Assets Control (OFAC), the Bank Secrecy Act and aid in the detection of money laundering and fraud. TFP also maintains the most authoritative and comprehensive databases of financial institutions. These databases are used to realize higher straight-through-processing rates for payments and to facilitate the repair of rejected transactions. Additionally, TFP facilitates global inter-bank communication and marketing, providing the widest array of print publication and marketing services. As official routing number registrar for the American Bankers Association, TFP issues, retires and maintains a record of all U.S. routing number assignments. For more information, visit Thomson Financial Publishing on the Internet at [http://www.tfp.com][3] or call 847/676-9600. Thomson Financial’s Banking, Insurance & E-Commerce Group is a division of Thomson Financial, a US$2 billion provider of e-information and integrated work solutions to the worldwide financial community. Through the widest range of products and services in the industry, Thomson Financial helps clients in more than 70 countries make better decisions, be more productive and achieve superior results. Thomson Financial is part of The Thomson Corporation (TSE:TOC), a leading, global e-information and solutions company with annual revenues of approximately US$6 billion. The Corporation’s common shares are listed on the Toronto and London stock exchanges. For more information on Thomson Financial, visit [http://www.thomsonfinancial.com][4].

[1]: http://www.fraudban.com/
[2]: http://www.wespay.org/
[3]: http://www.tfp.com/
[4]: http://www.thomsonfinancial.com/