A Class Act

MBNA continues to pump out about 100 affinity programs per quarter and an average of two million new accounts every ninety days according to data gathered by CardData ([www.carddata.com][1]). MBNA reported yesterday that net income for the second quarter of 1999 rose 28.6% during the second quarter of this year compared to last year. The company says it has produced consistent earnings increases, averaging 25%, in each of the thirty-four quarters since it became a public company. Total managed loans grew $2.4 billion during the second quarter to end up at $64.5 billion for 2Q/99. MBNA has approx. $2.0 billion in non-card loans and about $5.0 billion in international card receivables. Delinquency on total managed loans was 4.64% at June 30, 1999 compared to 4.60% for 2Q/98. Managed charge-offs for the second quarter logged in at 4.41% compared to 4.42% last year. MBNA says 2Q/99 charge volume, which includes purchases and cash advances, tallied up to $25,929,706,000 compared to $19,764,469,000 for 2Q/98. The firm’s net interest margin surged to 7.70% for 2Q/99 from 7.45% for 2Q/98. For complete current and historical financials for MBNA visit CardData ([www.carddata.com][2]).

MBNA HISTORICAL

PERIOD AFFINITY NEW ACCTS NET REVENUE
First Quarter 1998 110 1.7 million $149.4 million
Second Quarter 1998 111 2.5 million $172.0 million
Third Quarter 1998 121 2.4 million $216.6 million
Fourth Quarter 1998 133 2.7 million $238.3 million
First Quarter 1999 81 1.7 million* $186.0 million
Second Quarter 1999 99 1.4 million $227.2 million

*excludes 3.3 million accounts from PNC portfolio acquisition and
200,000 accounts from First Virginia portfolio acquisition.

Source: CardData
(http://www.carddata.com/) 301-631-9100

[1]: http://www.carddata.com/
[2]: http://www.carddata.com/

Garth Brooks Card

MBNA America and the Garth Brooks Touch ’em All Foundation announced yesterday the establishment of a credit card program for the Foundation. The five-year agreement includes an initial $1 million payment to the Touch ’em All Foundation with the potential for additional revenues based on the success of the program.

The Touch ’em All Foundation, established in January 1999, is a non-profit corporation which contributes financial resources to selected non-profit organizations that effectively serve and benefit children with an emphasis on health, education and inner city needs. The Foundation will enlist the participation of Major League Baseball players who will contribute a predetermined sum based upon selected categories of on-field performance. Each player will then be paired with “Celebrity Teammates” who will match the players donations. Seventy major league baseball players have already agreed to participate in the program.

“Garth is passionate about doing all he can do to help kids. The Foundation is excited that now everyone can join us as `teammates’ in this great cause,” said Bo Mitchell, co-founder and President of the Touch ’em All Foundation. “We are honored to be associated with such a fine institution as MBNA America Bank.”

“The Touch ’em All Foundation is the type of organization we are proud to work with,” said John R. Cochran, MBNA’s Chief Marketing Officer. “Customers will be very enthusiastic about the program and it will benefit some terrific causes.”

MBNA America, a subsidiary of MBNA Corporation (NYSE: KRB), is the largest independent credit card lender in the world with more than $60 billion in managed loans. MBNA is the “Official Credit Card Issuer of Major League Baseball” marketing its products to the fans of all 30 teams. MBNA also provides retail deposit, consumer loan and insurance products.

@Home Joins SCF

@Home Corporation has joined The Smart Card Forum (SCF), a multi-industry organization working to accelerate the widespread acceptance and application of smart card technology, as one of the Forum’s newest Principal Members, it was announced yesterday. Additionally, Louis Gasparini, vice president of Information Technology for @Home, has joined the Forum Executive Committee as Assistant Treasurer. As a leading innovator in the development of high speed Internet connections, @Home’s participation in the largest smart card organization demonstrates the value smart card applications bring to today’s emerging Internet economy.

“@Home brings to the Forum much insight and expertise on the rapid growth of the Internet and online service industry. The need for high-speed Internet connections will be increasingly important as smart card technology becomes more widely accepted,” said SCF President and CEO Donna Farmer. “We are thrilled to have @Home on board, and also to have Louis Gasparini’s participation on our Executive Committee. We are pleased to see the trend of Internet focused organizations such as @Home Corporation participating actively within the Smart Card Forum.”

As a Principal Member, @Home is entitled to privileged access to The Smart Card Forum Consumer Research, other Forum sponsored research and documents, along with attendance at the Technical Working Group sessions, Smart Card Forum Educational Institute programs, and the Annual Meetings.

About @Home

Based in Redwood City, CA, @Home Network (NASDAQ: ATHM) distributes high-speed, openly accessible Internet and Web services to residences and businesses using its own network architecture and a variety of transport options including the cable industry’s hybrid-fiber coaxial infrastructure. The cable connection provides users significant increases in speed over conventional Internet services. Leveraging the “always on” attributes of cable, @Home allows for unique multimedia applications that go beyond current Web experiences. Since its founding in 1995, @Home Network has reached affiliate agreements with 21 leading cable companies-worldwide, including AT&T Broadband and Internet Services, Cablevision Systems Corp., Cox Communications, Garden State Cable, and Midcontinent Cable Co., among others. More information is available at the @Home Network Web site at http://www.home.net.

About The Smart Card Forum

The Smart Card Forum is a non-profit, multi-industry organization of nearly 200 members working to accelerate the widespread acceptance of multiple application smart card technology by bringing together, in an open forum, leading users and technologists from both the public and private sectors. The Smart Card Forum is the leading organization for education and awareness of topical issues associated with the use and adoption of smart card systems. The Smart Card Forum also operates the Smart Card Forum Educational Institute, the industry-leading course dedicated to providing smart card education that has set the standard in the industry. The curriculum is based on leading edge educational models and methodologies utilizing experienced instructors who are experts in the smart card industry. For more information about The Smart Card Forum, log on to the organization’s website at [www.smartcardforum.org][1].

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

Hush Money

A popular Australian radio personality admitted yesterday he agreed to stop bashing banks on-the-air in exchange for more than one million Australian dollars. The bizarre story comes from CardWeb.com, Inc. president Robert McKinley who is visiting Sydney this week. As part owner of an advertising agency, Australian radioman John Laws came up with the idea in response to an initiative by the Australian Bankers Association to improve banks image. Laws regularly criticized banks, including their credit card programs, on a morning program airing on the 2UE radio station. After the deal was sealed, Laws, with two million listeners, ended his bank lambasting. Laws insists it was just a private business deal and since he is an entertainer, not a journalist, it does not matter. The Australian Consumers Association was not amused.

Hypercom & BP Agree

Hypercom Corporation Tuesday announced an agreement to provide BP with Hypercom’s ‘Ascendent Advanced Transaction Processor’. BP will use Hypercom’s ATP software to centralize, streamline and enhance the authorization and settlement of BP gas and fleet card transactions in Singapore and Malaysia. ‘Ascendent’ enables merchants and banks to offer advanced payment products, such as chip cards, and value-added services, such as loyalty programs.

Super ATM Patents

Capital Security Systems yesterday announced that it has received approval for three more patents on features of the Super ATM(TM) development platform, the ATM PowerBuilder, a powerful toolkit that will ultimately provide automated banking customers with a means for accessing 17 different banking functions from an ATM terminal.

“With the approval of these three patents,” stated Robin Gustin, president of CSS, “we are within sight of creating the ATM of the future — the ultimate in one-stop shopping for all of a customer’s electronic banking needs.” According to Gustin, the first patent covers signature verification in a terminal environment. Once verified, an ATM customer will be authorized to cash a check or money order, pay bills, create a money order, or perform a variety of other electronic financial transactions at an ATM location. The second patent covers the capability for a bank network customer to transfer funds from one ATM to any other ATM, in effect, emulating a Western Union wire order in an ATM environment. “It’s more convenient for the customer — and it will produce more fees for the networks, too,” explained Gustin. “Several things make our platform unique,” Gustin went on, “including check cashing technology that is 100% automated and the way we direct dollars and cents to a smart card, which is covered by the third patent.” Because Smart Cards enable more options and provide better security for the customer, Gustin believes that Smart Cards will eventually replace magnetic strip cards at ATMs. She says that the possibilities created by the powerful ATM PowerBuilder platform should help gain bank support for the conversion to a Smart Card-based, e-commerce society.

According to Gustin, the ATM PowerBuilder will enable banking networks to access three major electronic financial markets: conventional ATM banking, electronic benefits transfer, and unbanked customers. According to a recent government study, unbanked customers comprise one out of every eight homes in the U.S. — which means possibly another strong revenue source for the networks. CSS is currently talking to a number of large domestic and foreign companies that are seeking to secure a controlling interest in the ATM-based world of electronic commerce by owning the patents granted to the Super ATM(TM) — ATM PowerBuilder platform.

Art.com Preferred Card

Art.com, the leading consumer brand of Getty Images, Inc., announced Tuesday an agreement with Visa U.S.A. which designates Visa the “Preferred Card” on the Art.com site, and will allow Art.com to develop marketing promotions that will be offered exclusively to Visa cardholders.

Under the terms of this agreement, Art.com will be included in Visa’s Value-Added Offers to millions of its cardholders, and promoted through statement inserts, direct mail, sweepstakes, e-mails and online mentions. These co-branding opportunities include Visa’s Back to School and Holidays promotions featuring Art.com — expected to generate one million impressions via Art.com’s website. Art.com is included in the Visa Rewards online program via jump page advertising on [http://www.visa.com][1] and hot links to financial member web sites and two exciting sweepstakes featuring Visa as a primary means for entry. Additionally, Art.com provides Visa’s cardholders exclusive offers when shopping at [http://www.art.com][2].

“Art.com is proud to name Visa as its preferred card. Our goal is to create the most satisfying and enjoyable consumer experience possible on our site, and Visa shares our commitment to excellent customer service,” said Bill Lederer, CEO of Art.com. “With their international reach and focus on using technology to enhance customer convenience, safety and flexibility, they are a natural partner for us in the e-commerce arena.”

During the important holiday season, Art.com hopes to generate an estimated one billion impressions through co-branded online advertising. The partnership allows Art.com, the leading destination for art and art- related products on the web, to extend its marketing programs to include Visa’s extensive customer base. According to Visa, online purchases represent one of their fastest growing market segments.

“Online purchasing has become a regular part of our customers’ shopping habits, and Visa is very pleased to be working with a leading e-commerce brand such as Art.com,” said Jim Degrocici, SVP, E-commerce, Visa U.S.A. “Partnering Visa with Art.com creates a wonderful opportunity to provide products of high quality and value to Visa’s cardholders.”

About Visa

As the “World’s Best Way to Pay,” Visa is the leading payment brand and the largest consumer payment system worldwide with more volume than all other major payment cards combined. Visa plays a pivotal role in advancing new payment products and technologies to benefit its 21,000 member financial institutions and their cardholders. Visa has more than 70 smart card programs in 33 countries and on the Internet, with 23 million Visa chip cards, including over 8 million Visa Cash cards. Visa is pioneering SET Secure Electronic Transaction(TM) programs to enable and advance Internet commerce. There are more than 630 million Visa-branded cards, which generate over US $1.3 trillion in annual volume. Visa is accepted at more than 15 million worldwide locations, including at over 450,000 ATMs in the Visa Global ATM Network. Visa’s Internet address is [http://www.visa.com][3].

About Art.com

Art.com(SM) ([http://www.art.com][4]), the consumer brand of Getty Images, Inc., is an inviting and engaging e-commerce destination that makes buying art accessible, personal and fun by offering valuable information consumers need to learn about and purchase art. The site is an enriching and convenient source for art, offering many of the world’s great prints in one place. Art.com’s expansive galleries feature master works by world-famous artists, as well as original pop culture artists. In addition to everyday discounts, personalized product choices and a 100 percent satisfaction guarantee, Art.com offers three distinguishing features — framing visualization software, seasonal and featured galleries, and the ArtClique(SM) Saver’s Club. Art.com is the recipient of the respected Pinnacle Award for Overall Excellence and the eMarketer Web recognition Award. Art.com is the consumer brand of Getty Images, Inc. (Nasdaq: GETY), the leading, global provider of visual content. More information about Getty Images and its visual content brands can be found on the company’s Web site at .

[1]: http://www.visa.com/
[2]: http://www.art.com/
[3]: http://www.visa.com/
[4]: http://www.art.com/

New Zealand E-Billing

CheckFree, in partnership with New Zealand Post, has launched a program that will enable New Zealanders to receive, view and pay their bills electronically through the Internet. Involved with the program is the Bank of New Zealand, which provides the payment mechanism and allows customers to access the system from its home banking system on the Internet. The initial bills being presented and paid on the Internet are from Saturn Communications and Bank of New Zealand Credit Cards.

Oberthur Prez

Oberthur Smart Cards USA named Philippe Tartavull president and CEO of Oberthur Smart Cards USA this morning. The former COO takes the reins from Kirk Hyde who has held the CEO post since 1980 and who will remain on the Board of Directors. Oberthur Smart Cards USA resulted from the purchase of family-owned Kirk Plastic Company by Groupe Franssois-Charles Oberthur in October of 1996. For six years, Philippe Tartavull was the president and CEO of SYSECA, a $25 million North American subsidiary of Thomson CSF, helping to diversify the company into future high growth markets including interactive TV, smart cards and Internet/Intranet technologies.

TSYS Heads South

Total System Services signed of a multi-year agreement with Bancahsa, the second-largest bank in Honduras, to process its ‘Honducard-VISA’ credit cards. The processing contract includes the combined portfolios of Bancahsa and subsidiaries, Bancahorro and Credihsa. TSYS will process the ‘Honducard-VISA’ accounts from its Columbus, Ga., headquarters and provide production and support from TSYS de Mexico’s facilities in Toluca, Mexico. Bancahsa is headquartered in Tegucigalpa, the capital of Honduras. Together with the subsidiary companies of El Ahorro Hondureno Group, S.A., Bancahsa represents the most complete financial services institution in Honduras, supported by a network of over 100 strategically located offices and more than 30 ATMs in the principal cities of Honduras.

Lockheed Deal

U.S. Bancorp has been selected by Lockheed Martin Corp. as their exclusive provider of VISA purchasing cards. The five-year agreement is expected to incur approximately $750 million in annual charges, resulting in nearly $4 billion over the term of the agreement. It is the largest commercial purchasing card program in the world. The program includes all 110 business units within Lockheed Martin and will create cost savings and synergies among 50 different accounting systems. U.S. Bancorp is the largest issuer of VISA corporate and purchasing cards in the world. Its client list includes 153 Fortune 500 companies, 248 of the Fortune 1000, several agencies of the Federal government and five state governments. U.S. Bancorp has also served as the company’s corporate T&E card provider since 1997. When the program is fully implemented, Lockheed estimates that it will eliminate approximately 700,000 accounts payable transactions annually. For current and historical data on U.S. Bancorp’s card portfolio visit CardData([www.carddata.com][1]).

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

MasterCard All-Star

[G2 RealVideo Format – Videos with Hank and Willie Priceless(All-Star Game)][1]

MasterCard will air its latest “Priceless” advertising spot in tonight’s FOX Network broadcast of the ‘1999 All-Star Game in Boston. The “All-Century Team” TV spot features four baseball legends including Hank Aaron, Willie Mays, George Brett, and Barry Bonds. MasterCard is also running a card usage sweepstakes which offers fans a chance to win a ‘Priceless Moment’ at the 1999 World Series. The ‘MasterCard All-Century Team Sweepstakes’ will award five winners an all expense paid trip for four to the 1999 World Series to sit with select living members of the ‘All-Century Team’. Visit CardTrak ([www.cardtrak.com][2]) for consumer details and click on CardWatch (www.cardwatch.com) to view the new spot.

[1]: http://205.161.111.200:8080/movies/mastercard/mastercard_allcenturyteam.rm
[2]: http://www.cardtrak.com