bofa Archives • Page 30 of 58 • CardFlash®

BofA Dominates the U.S. Credit Card Market

5, Country, Priority, UNITED STATESBy Robert McKinley 05/22/2008

Bank of America still rules the U.S. credit card market rising 8% Y/Y in the first quarter, compared to Chase at 3% and Citi at 4%. This is typically a seasonal low quarter but all big three credit card issuers posted positive increases. Bank of America’s credit card loans increased from $150.7 billion in 1Q/07 to $163.2 billion in 1Q/08. Chase’s credit card loans soared from $152.8 billion in 1Q/07 to $157.1 billion in 1Q/08. According to CardData, Citi reported $116.4 billion in credit card loans, compared to $111.6 billion in 1Q/07.

BIG THREE CARD OUTSTANDINGS
1Q/08 1Q/07
BofA $163.2 billion $150.7 billion
Chase $157.1 billion $152.8 billion
Citi $116.4 billion $111.6 billion
Source: CardData (www.carddata.com)

L.L. Bean Terminates its BofA Card Deal

5, Country, Priority, UNITED STATESBy Robert McKinley 05/21/2008

Retailer L.L. Bean will discontinue its credit card program with Bank of America as of June 30th. Customers will continue to receive free shipping and free monogramming on orders placed with the current L.L.Bean Visa Card through June and continue to earn L.L.Bean Coupon Dollars on all purchases made through June 30, 2008 with your current L.L.Bean Visa Card L.L.Bean Coupons issued to you at any time will remain valid until their stated expiration date. Information about the new card program will be provided in the next few weeks.

TSYS Hires BofA Merchant Services Exec

5, Country, Priority, UNITED STATESBy Robert McKinley 05/19/2008

TSYS Acquiring Solutions has appointed David E. Wood, previously with Bank of America, as COO. Wood served as a senior executive with Bank of America for the past 15 years and was most recently responsible for its BA Merchant Services operations in Louisville, Ky. BA Merchant Services was recently ranked as the second largest merchant acquirer in the United States. Prior to Wood’s tenure with Bank of America, he held management positions in operations with Bank One. He holds a bachelor’s degree in business administration from Hardin Simmons University.

BofA’s Keep the Change Program Tops $1B

5, Country, Priority, UNITED STATESBy Robert McKinley 05/14/2008

Bank of America reports that customers enrolled in its innovative and patent pending “Keep the Change” program have accumulated approximately $10 billion in savings, including the $1 billion in customer round-ups and bank-matching funds. Eight million customers are currently enrolled which offers the option on every check card purchase. The program, which launched in October 2005, offers a 100% match by Bank of America for the first three months and 5% thereafter, up to a maximum of $250 per year. Purchases with rewards or ATM cards are not eligible for matching. BofA will only match “Keep the Change” transfers on up to five checking accounts per depositor (including joint depositors) or up to five checking accounts per household, whichever is less. The U.K.’s Lloyds TSB launched “Save the Change” in 2007 which mirrors the BofA U.S. program. (CF Library 10/7/05; 12/5/06)

Bank of America & Fiserv CheckFree Renew

5, Country, Priority, UNITED STATESBy Robert McKinley 05/02/2008

Bank of America has renewed its multi-year strategic vendor agreement with Fiserv’s CheckFree. The new agreement includes higher technology and customer support levels for Bank of America’s market-leading online consumer bill payment service. Specific terms of the amended agreement, which dates back to December 2003, were not disclosed.

BofA Q1 Credit Card Profits Plummet 39%

5, Country, Priority, UNITED STATESBy Robert McKinley 04/21/2008

Bank of America reported that its Card Services division net revenue increased 21% to $7.33 billion due to 15% growth in net interest income and 33% growth in non interest income driven by 14% growth in average loans and leases, Card Services allocation of the VISA, Inc. IPO gain and higher card income. However, net income of $670 million was down 39% as the higher net revenue and the reversal of litigation costs related to VISA were more than offset by higher credit costs. Managed U.S. consumer and business credit card loans at the end of the first quarter was flat sequentially at $161.4 billion. First quarter U.S. Card Services charge-offs were 5.67%, compared to 5.03% in the prior quarter and 4.82% one-year ago. The managed 30+ day delinquency rose to 5.93%, compared to 5.70% in the fourth quarter and 5.45% for 1Q/07. Purchase volume for U.S. consumer and business cards was $56.8 billion for 1Q/08 compared to $64.7 billion for 4Q/07 and $55.4 billion for 1Q/08. BofA also reported that mobile banking recorded approximately 224,000 activations in the first quarter reaching 840,000 active customers. The “Keep the Change” program reached 8 million net new enrollments since inception, with 974,000 customers alone signing up in the first quarter. For complete details on Bank of America’s 1Q/08 performance, visit CardData ([www.carddata.com][1]).

BOFA EOP CARD LOAN HISTORICAL
(U.S Consumer & Business Cards)
1Q/07: $144.9 billion
2Q/07: $148.7 billion
3Q/07: $153.0 billion
4Q/07: $161.4 billion
1Q/08: $161.4 billion
Source: CardData (www.carddata.com)

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

BofA Tops Card Issuers’ ID Safety Scorecard

5, Country, Priority, UNITED STATESBy Robert McKinley 04/07/2008

Javelin Strategy & Research have released its annual “Card Issuers Identity Safety Scorecard” which evaluates 25 of the nation’s top credit card issuers against a benchmark of highly-specific safety criteria in the areas of “Prevention”, “Detection” and “Resolution”. The benchmark is based on extensive surveys of both fraud victims and institution practices. Javelin ranked the nation’s top credit card issuers on the services and measures they have implemented in partnership with consumers to protect against identity fraud. It analyzed data supplied by the issuers’ customer service representatives and consulted information available on card issuers’ websites. Javelin researchers validated the process with firsthand reviews of actual features in selected cases. Overall, Bank of America achieved top honors in Javelin’s 2008 Card Issuers’ “Identity Safety Scorecard”; second place went to Discover, followed by FNB Omaha and U.S. Bank. In the “Prevention” category, the top three card issuers were Bank of America, followed by FNB Omaha and then Discover. Within the “Detection” category, American Express leads, then U.S. Bank with Bank of America in third place. For the “Resolution” category the top honor is equally shared by American Express, Bank of America, Discover, JPMorgan Chase, State Farm Bank, Wachovia, and WaMu.

BofA Offers Patented Corporate Card Controls

5, Country, Priority, UNITED STATESBy Robert McKinley 04/03/2008

Bank of America has been granted a patent for a new technology that enables its clients to manage the available funds on corporate purchasing cards dynamically and in real time. BofA’s “Active Card Control” is an extension of its commercial card product suite. Using the technology, the client can reset the available funds on each card as frequently as necessary through a web-based tool. When initially issued, cards will have $0 in available funds until the client is ready to pay the supplier. At that time, the client submits a purchase request through the “BofA Works” application which uses the “Active Card Control” technology to fund individual cards with the exact amount of the invoices to be paid. When those purchases are billed to the card, the available funds go to zero. Key benefits of “ACC” for the client include improved administrative efficiency and lower costs from not having to raise and lower credit limits or change single transaction limits; increased control over purchasing due to a mandatory approval process; reduced paperwork; and ease of implementation as purchase requests can be used with any card program that uses the Works platform.

CardFlash Looks Back to December 2007

5, Country, Priority, UNITED STATESBy Robert McKinley 01/25/2008

CPI Card Group expands its “green” manufacturing initiative by using wind power to runs its Colorado plant. BofA introduces the new “Brighter Planet VISA” from Bank of America enables cardholders to earn one “EarthSmart” point for every $1 spent in purchases. VeriFone’s stock collapses after the Company reported that its financial reports for this year were not accurate. MasterCard introduces the first prepaid travel card with contactless technology. Discover Financial Services says it will take a $422 million impairment charge related to its “Goldfish MasterCard” and “Goldfish VISA” credit card business in the U.K. for the quarter ending November 30th. Metavante inks an agreement to offer its merchant clients full-service processing for all Discover Network card transactions. Omaha-based Planet Group has signed an agreement to acquire AZ-based Opticard Payment Services. Bankrate acquires Memphis-based Nationwide Card Services for $26.4 million in cash with a $7.0 million earn-out over the next two years. Payment card hologram specialist American Bank Note Holographics signs a deal to be acquired by communications specialist JDSU for $138 million in cash plus stock. GE indicates it is looking to sell or form a partnership for some of its GE Money services including its U.S. private-label credit-card business. Discover Financial Services buys the discover.com domain name, formerly used by Discover magazine, for $5 million. The European Commission decides to force drastic reductions on MasterCard Europe’s default cross-border interchange fees. Hypercom enters final negotiations to acquire the e-Transactions business line of Thales.

BofA Card Profit Drops 50% as Losses Mount

5, Country, Priority, UNITED STATESBy Robert McKinley 01/22/2008

Bank of America reported that its Card Services division had Q4 revenue of $6.6 billion, an increase of 3% compared to the fourth quarter of last year, but net income slid 50% to $574 million. Managed U.S. consumer and business credit card loans at the end of the fourth quarter increased 8% year-on-year to $163.2 billion. Fourth quarter U.S. Card Services charge-offs were 5.08%, compared to 4.86% in the prior quarter and 4.57% one-year ago. The managed 30+ day delinquency rose to 5.74%, compared to 5.44% in the third quarter and 5.49% for 4Q/06. Purchase volume for U.S. consumer and business cards was $64.8 billion for 4Q/07 compared to $61.4 billion for 3Q/07 and $60.1 billion for 4Q/06. For the full year Card Services managed net revenue grew 4% to $25.53 billion due to growth in cash advance fees and interchange income while net income of $3.71 billion was down 35% as credit costs rose. BofA also reported that debit card purchase volume for full year 2007 increased 12% to $189.4 billion. “Keep the Change,” BofA’s savings program that combines debit cards and deposit products, had about 3 million enrollments during the year. For complete details on Bank of America’s 4Q/07 performance, visit CardData ([www.carddata.com][1]).

BOFA EOP CARD LOAN HISTORICAL
(U.S Consumer & Business Cards)
4Q/06: $150.7 billion
1Q/07: $146.0 billion
2Q/07: $150.2 billion
3Q/07: $154.7 billion
4Q/07: $163.2 billion
Source: CardData (www.carddata.com)

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

4Q/07 Charge-Offs Rise Across the Board

5, Country, Priority, UNITED STATESBy Robert McKinley 01/17/2008

The credit card industry is bracing for more bad news as BofA is set to release its fourth quarter report next week. So far, Chase, Citi and AmEx have reported sharply higher charge-offs for the fourth quarter while Cap One also showed a significant uptick in its November charge-offs. Cap One reported that charge-offs hit 5.74% in November, compared to 5.11% in the prior month and 3.79% one-year ago. Cap One will release its fourth quarter report next week. Citi’s charge-offs for bankcard and private label cards rose to 5.11% for 4Q/07, compared to 4.53% in the prior quarter and 4.35% one-year ago. Bankcard charge-offs for Citi rose to 4.65% in 4Q/07 from 4.15% in the prior quarter and 4.05% one-year ago. Chase posted a managed net charge-off rate for the fourth quarter of 3.89%, up from 3.45% in the prior year and 3.64% in the prior quarter. American Express had a charge-off rate for 4Q/07 of 4.3% compared to 3.7% in the prior quarter and 3.5% for 4Q/06.

BANK CREDIT CARD CHARGE-OFFS
4Q/06 1Q/07 2Q/07 3Q/07 4Q/07
Chase 3.45% 3.57% 3.62% 3.64% 3.89%
Citi 4.05% 4.27% 4.25% 4.15% 4.65%
AmEx 3.50% 3.70% 3.70% 3.70% 4.30%
Source: CardData (www.carddata.com)

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