bofa Archives • Page 46 of 58 • CardFlash®

Top 10 Grew 6.5% Last Year; Hold 77% of the Market

5, Country, Priority, UNITED STATESBy Robert McKinley 02/06/2004

In terms of organic growth, Bank of America, Capital One, and American Express led the U.S. credit card industry with double digit gains in receivables and profits last year. The nation’s top ten bank credit card issuers grew an average of 6.5% during 2003, holding aggregate card loans of $538.9 billion, approximately 77% of the total U.S. market. Citigroup, the nation’s #1 ranked issuer would have slipped to second place had it not been for the acquisition of the Sears MasterCard portfolio in November. Citigroup card loans increased $7.4 billion during 2003 as it added $13 billion in Sears MasterCard card loans during the fourth quarter. Indeed, Citigroup’s organic growth was negative in every quarter of 2003. Bank of America led the top issuers with a 24% gain in outstandings. BofA also led with a 25% in card profits, according to CardData ([www.carddata.com][1]). Discover was the only issuer to post a portfolio contraction. However, Discover data does not reflect the impact of the December holiday season. (CF Library 2/4/04)

Top 10 U.S. Issuers by Card Loans
RANK/ISSUER 4Q/03 4Q/02 Y/Y
1. Citigroup $119.8b $112.4b + 6.6%
2. MBNA $ 85.8b $ 79.5b + 7.9%
3. Bank One $ 76.3b $ 74.0b + 3.1%
4. JPM Chase $ 52.3b $ 51.1b + 2.3%
5. Discover* $ 48.4b $ 51.1b – 5.3%
6. Capital One $ 46.3b $ 40.9b +13.2%
7. AmEx $ 38.5b $ 34.3b +12.2%
8. BofA $ 36.6b $ 29.5b +24.1%
9. Household $ 17.9b $ 17.0b + 5.3%
10. Fleet $ 17.0b $ 16.2b + 4.9%
TOTAL $ 538.9b $506.0b + 6.5%
*Discover data as of 11/30/03, all others as of 12/31/03.
Source: CardData (www.carddata.com)

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

Card Profits for Top Issuers Up 17% in the Fourth Quarter

5, Country, Priority, UNITED STATESBy Robert McKinley 02/04/2004

Credit card profits among the nation’s largest issuers grew an average of 17% in the fourth quarter. MBNA led the pack with a 30% surge in profits, followed by Chase with a 25% increase in card operating income. Citigroup posted its first billion dollar profit quarter in 4Q/03 thanks to its acquisition of the Sears card portfolio in November. The nation’s top three issuers, ranked by card loans, raked in $2.2 billion in fourth quarter profits, while seven top issuers collectively produced $3.6 billion in 4Q/03 profits. On the other end of the scale, Bank of America’s card profits were up 3%, and Bank One produced an 8% gain in net income. In the middle, but below the group average, is Capital One with an 11% increase, and American Express with a 10% gain over 4Q/02. For complete details on 4Q/03 portfolio performance visit CardData ([www.carddata.com][1]).

PROFIT SNAPSHOT
ISSUER 4Q/03 4Q/02 CHNG
Citigroup $1140 $931 +22%
MBNA $704 $540 +30%
AmEx $606 $550 +10%
Bank One $347 $321 + 8%
BofA $323 $313 + 3%
Cap One $266 $240 +11%
Chase $171 $137 +25%
TOTAL: $3557 $3032 +17%
$millions Source: CardData (www.carddata.com)

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

BofA Adds $3 Billion in Card Loans & 400K Accounts

5, Country, Priority, UNITED STATESBy Robert McKinley 01/15/2004

Bank of America reported this morning that its credit card outstandings rose nearly $3 billion in the fourth quarter, producing a 24% increase over the one-year ago quarter. BofA says it added 414,000 new credit card accounts during the fourth quarter. For all of last year BofA opened 4.26 million new credit card accounts compared to 2.67 million in 2002. BofA says the account growth was driven by the development of more competitive offers, improved technology at the point of sale and an increase in direct mail marketing. For 2003, BofA notes that consumer credit and debit card purchase volumes increased 13% and 22%, respectively. Bof A reports that its card income increased 11% to $815 million. Managed credit card profits were $323 million for the fourth quarter, a 3% gain over 4Q/02. Total revenue for its managed credit card portfolio was $1.2 billion, a 3% gain over last year. At the end of the fourth quarter, BofA had $36.6 billion in managed credit card outstandings, a 24% increase over the year-ago quarter. Fourth quarter charge-offs were 5.12%, compared to 5.32% in the prior quarter, and 5.03% one year ago. Managed 30+ day delinquency was 3.93%, compared to 3.84% in the third quarter, and 3.94% for 4Q/02. Managed 90+ day delinquency was 1.77%, compared to 1.76% in the third quarter, and 1.71% for 4Q/02. For complete details on Bank of America’s 4Q/03 performance visit CardData ([www.carddata.com][1]).

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

BofA Online Banking Tops 7 Million Subscribers

5, Country, Priority, UNITED STATESBy Robert McKinley 12/19/2003

Bank of America yesterday reported it has topped 7 million subscribers for its free online banking service, compared to 4.7 million at the beginning of the year. BofA also says the number of customers paying their bills online increased from 1.8 million to 3.0 million this year. BofA provides online bill payment services through CheckFree, which recently modified its contract due to the rapid growth of the service. For the second year in a row, Global Finance magazine recognized Bank of America as having the best consumer Internet bank site in the world. Jupiter Research ranked Bank of America No. 1 in its CORE rankings and Vividence ranked bankofamerica.com No. 1 in experience for customers and prospective customers. Meanwhile, U.S. Bank announced this week it is dropping its $4.95 monthly fee for its “Internet Bill Pay” for new or existing consumer checking accounts.

CheckFree and BofA Tweak Contract

5, Country, Priority, UNITED STATESBy Robert McKinley 12/05/2003

CheckFree and Bank of America have fine tuned their contract in the face of the rapid growth of BofA’s in online users. The terms of the agreement are intended to expand the relationship for the duration of the original ten-year contract, which runs through 2010. Among other items, there are adjustments to long-term service pricing. CheckFree says the new transaction-based pricing allows CheckFree and the bank to take advantage of economies of scale. However, CheckFree noted that, despite the contract changes, BoA’s minimum annual revenue commitments remain in place at $50 million per year. In the third quarter, more than 11 million consumers initiated online payments through services offered by CheckFree’s e-commerce division. EBPP is available through more than a thousand financial services organizations. About 300 billers participate. CheckFree delivers nearly 15 million e-bills each quarter.

Top 3 Issuers Have 40% Share; Top 10 Hold 80%

5, Country, Priority, UNITED STATESBy Robert McKinley 11/14/2003

The nation’s top three issuers now control more than 41% of the bank credit card market, based on second quarter outstandings. Based on charge volume, Citigroup, MBNA, and Bank One, now hold a 39.8% share of the market. During the third quarter, Capital One gained market share while Providian gave up some share. (Third quarter industry data is currently being finalized.) As a group, the top ten issuers control more than 80% of the domestic bank credit card market. Based on second quarter charge volume, the top ten hold 81.6% of the U.S. market. With the exception of American Express, all of the top ten issuers have a larger market share based on outstandings than charge volume. For the second quarter the industry’s total receivables were $646.2 billion, and charge volume for the quarter was $373.2 billion. For complete details on second and third quarter portfolio results plus historical quarterly data since 1994, visit CardData ([www.carddata.com][1]).

Top Ten Market Share (2Q/03)
RANK/ISSUER OUTSTANDINGS VOLUME
(ranked by $ billions of bank credit card loans for 3Q/03)
1. Citigroup 17.5% 16.7%
2. MBNA 12.5% 12.2%
3. Bank One 11.3% 10.9%
4. Cap One 7.3% 5.0%
5. Chase 7.9% 5.9%
6. Discover 7.9% 6.4%
7. AmEx 5.6% 17.3%
8. BofA 4.8% 3.6%
9. Household 2.6% 2.5%
10. Providian 2.8% 1.1%

All data represent U.S. card loans except Citigroup which includes other North American cards.
Discover data as of 8/31/03, all others as of 9/30/03.
Q/Q: % change from second quarter 2003; Y/Y: % change from third quarter 2002
Source: CardData (www.carddata.com)

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

YTD 3Q/03 Volume Up 6.6%, AmEx Leads the Pack

5, Country, Priority, UNITED STATESBy Robert McKinley 11/10/2003

American Express has unseated Citigroup as the leader in U.S. credit card gross dollar volume for the third consecutive quarter, with a year-to-date volume of $190 billion compared to Citi’s $179 billion. Through the third quarter, AmEx has also led volume growth at the network level with a year-to-date growth rate of 10.9%, versus a 5.9% annual growth rate for VISA and MasterCard’s combined U.S. credit card volume, and a 4.2% growth rate for Discover. For the first three quarters of 2003, overall U.S. credit card gross dollar volume is up 6.6% to $1112.6 billion. Among the top ten issuers, ranked by volume, MBNA, Bank One, Bank of America, American Express and Capital One posted above average gains in credit card volume. Fleet was down 7% over last year and Citigroup has been flat for the first three quarters of 2003. During the third quarter VISA and MasterCard posted U.S. credit card volume of $167.8 billion and $133.1 billion, respectively. Year-to-date, VISA and MasterCard’s U.S. credit card gross dollar volume is $847.9 billion, compared to $800.9 billion for the first three quarters of 2002. For complete details on third quarter portfolio results plus historical quarterly data since 1994, visit CardData ([www.carddata.com][1]).

RANK/ISSUER 3Q/03 3Q/02 Y/Y
($ billions of bank credit card volume for Q1+Q2+Q3)
1. AmEx $189.8 $171.2 +10.9%
2. Citigroup $179.1 $179.2 NC
3. MBNA $134.2 $116.1 +15.6%
4. Bank One $121.6 $107.9 +12.7%
5. Discover $ 74.9 $ 71.9 + 4.2%
6. Chase $ 65.8 $ 62.7 + 4.9%
7. Cap One $ 53.5 $ 50.0 + 7.0%
8. BofA $ 40.3 $ 35.9 +12.3%
9. Household $ 27.4 $ 26.5 + 3.4%
10. Fleet $ 17.2 $ 18.5 – 7.0%
TOTAL $903.8 $839.9 + 7.6%

All data represent U.S. year-to-date credit card volume except Citigroup which includes other North American cards, and MBNA which does not break-out domestic volume from global volume. Chart also excludes U.S. Bancorp, which ranks among the top ten, since the issuer has not reported third quarter 2003 volume as of today; Discover data as of 8/31/03, all others as of 9/30/03. Y/Y: % change from third quarter 2002 Source: CardData ([www.carddata.com][2])

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

Top 10 Issuers Q3 Growth Ranges from -14% to +20%

5, Country, Priority, UNITED STATESBy Robert McKinley 11/04/2003

Bank of America has emerged as the fastest growing issuer among the nation’s ten largest general purpose credit card firms, while marketing powerhouses MBNA and Capital One have downshifted. For the third quarter BofA posted a sequential gain of 9% and a year-over-year increase of nearly 20%. Compared to the second quarter Capital One posted the largest increase, but since 3Q/02 the issuer is up 16.7%, according to CardData (www.carddata.com). Meanwhile, American Express ranks as the third fastest growing major issuer, although their portfolio was flat compared to 2Q/03. Providian, still shedding bad accounts, is down 14% from last year and nearly 5% since the prior quarter. Chase and Discover have both experienced flat growth over the past twelve months. For complete details on third quarter portfolio results plus historical quarterly data since 1994, visit CardData ([www.carddata.com][1]).

RANK/ISSUER 3Q/03 Q/Q Y/Y
($ billions of bank credit card loans)
1. Citigroup $117.4 3.6% 2.9%
2. MBNA $ 81.8 1.2% 7.8%
3. Bank One $ 74.2 1.6% 7.2%
4. Cap One $ 52.5 11.2% 16.7%
5. Chase $ 50.3 -1.4% -1.6%
6. Discover $ 50.0 -1.6% 0.5%
7. AmEx $ 35.9 -0.2% 11.5%
8. BofA $ 33.6 9.1% 19.9%
9. Household $ 17.6 5.7% 10.9%
10. Providian $ 17.0 -4.8% -14.1%

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

Charter One Introduces Free MasterCard Gift Card

5, Country, Priority, UNITED STATESBy Robert McKinley 10/29/2003

Cleveland-based Charter One Bank has launched the first “MasterCard Gift Card” that features no upfront fees for the card or for processing. The new stored-value, personalized card is available in 25 designs and in denominations from $25 to $500. Customers who request express processing are charged $50, but the usual turn-around time is 7 to 10 business days. Charter One charges a $2 fee for each ATM withdrawal or cash advance and a $1 fee for each PIN POS transaction. The card is good for six months. Other fees include a $10 expired card fee, $10 refund processing fee, and a $2.50 monthly inactivity fee if the card remains inactive after six months. Bank of America, the largest issuer of bank gift cards, charges a $5.95 fee for new cards with up to $300 in value, and a $7.95 fee for values between $300 and $600. BofA also charges a $1.50 for each ATM transaction on its network plus any surcharges from other institutions, a $2.50 monthly maintenance fee after six months, a $7.50 reissuance fee, a $15 check issuance fee, and a $25 fee for use of the card in excess of the amount stored.

Bank of America to Become 6th Largest Card Issuer

5, Country, Priority, UNITED STATESBy Robert McKinley 10/27/2003

Bank of America and FleetBoston this morning announced a definitive agreement to merge, creating a bank with a footprint in every region of the USA. The merger will also combine the credit card portfolios of the nation’s #8 issuer and #11 issuer. The new Bank of America credit card portfolio will have approximately $48.3 billion in outstandings, making it the sixth largest U.S. issuer of bank credit cards and the fifth largest issuer of VISA and MasterCards. At the end of the third quarter, BofA reported $33.6 billion in managed card loans, while Fleet reported $14.7 billion in managed card outstandings. BofA has about 23 million credit cardholders and Fleet has 10.5 million. The new BofA will have nearly 5,700 retail banking offices and more than 16,500 ATMs.The company will have 9.8% of the banking deposits in the USA and have the first, second or third largest market shares in 21 of the 29 states in its retail footprint, including significant market shares in 21 of the nation’s 30 largest metropolitan areas. The transaction is valued at $47 billion and is expected to close in the first half of 2004.

BofA Leads the Pack of ACH Payment Recipients

5, Country, Priority, UNITED STATESBy Robert McKinley 10/17/2003

The Electronic Payments Association has released its first ever list of the top 50 largest receiving financial institutions of ACH payments which shows Bank of America topping the list with more than 507 million payments. A significant finding of the NACHA survey is that the receipt of ACH payments is much less concentrated than origination. The top 5 institutions accounted for 22 percent of ACH volume, compared to 49 percent on the origination side. NACHA is the leading organization in developing electronic solutions to improve the payments system.

BofA Credit and Debit Card Profits Up 16%

5, Country, Priority, UNITED STATESBy Robert McKinley 10/14/2003

Bank of America reported this morning that its card income increased 16% to $794 million. The issuer says consumer credit and debit card purchase volumes increased 14% and 23%, respectively, since 3Q/02. Managed credit card profits were $319 million for the third quarter, a 28% gain over 3Q/02. Total revenue for its managed credit card portfolio was $1.1 billion, a 26% gain over last year. At the end of the third quarter, BofA had $33.6 billion in managed credit card outstandings, a 20% increase the year-ago quarter. Third quarter charge-offs were 5.33%, compared to 5.74% in the prior quarter, and 5.13% one year ago. Managed 30+ day delinquency was 3.84%, compared to 3.99% in the second quarter, and 3.63% for 3Q/02. Managed 90+ day delinquency was 1.76%, compared to 1.80% in the second quarter, and 1.66% for 3Q/02. BofA also reported that its 2.8 million active bill pay users paid $12.7 billion of bills during the quarter. For complete details on Bank of America’s 3Q/03 performance visit CardData ([www.carddata.com][1]).

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

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