San Diego-based Cubic Transportation Systems has landed an additional $3.4 million contract from San Francisco’s BART to expand the scope of its work on the “TransLink” fare collection equipment. TransLink will permit riders to use a single smart card to pay for fares in order to travel across all public transit systems throughout the Bay Area. Cubic will be allowed to integrate its smart card technology into BART’s ticket vending machines. This will enable customers to load fare value onto an “e-purse” on their TransLink cards. The e-purse stores cash value on the smart card chip and serves as an electronic wallet. Each year, Cubic fare collections systems are used for customers to take nearly 10 billion rides around the world.
After a one-month uptick, Capital One’s charge-offs headed south, falling 8 basis points in October. However, delinquency continued to edge upward for the sixth consecutive month, rising 4 basis points during October. During October, the issuer added $455 million in managed outstandings. Cap One reported that managed charge-offs decreased to 4.10% for October, compared to 4.18% in September, and 5.30% one-year ago. In June 2003, Cap One’s managed charge-off ratio stood at 6.20%. Delinquency increased to 3.94% for October, compared to 3.90% for September, 3.90% in August, 3.77% in July, 3.76% in June, 3.73% in May, and 3.69% in April. Delinquency one-year ago stood at 4.52%. At the end of October, Capital One had $75.9 billion in global oustandings. At the end of the third quarter, Cap One had $46.1 billion in U.S. card loans, compared to $45.2 billion in the second quarter. For complete details on Capital One’s monthly metrics and 3Q/04 performance, visit CardData ([www.carddata.com]).
Capital One 2003-2004
Month Charge-offs Delinquency
Oct 03 5.30% 4.52%
Nov 03 5.57% 4.46%
Dec 03 5.10% 4.46%
Jan 04 5.00% 4.39%
Feb 04 4.75% 4.14%
Mar 04 4.74% 3.80%
Apr 04 4.70% 3.69%
May 04 4.40% 3.73%
Jun 04 4.17% 3.76%
Jul 04 4.10% 3.77%
Aug 04 3.87% 3.80%
Sep 04 4.18% 3.90%
Oct 04 4.10% 3.94%
Source: CardData (www.carddata.com).
Capital One has signed a definitive agreement to privately held HFS Group, a major home equity loan broker in the UK. Cap One will pay $117 million in cash. HFS originated a volume of approximately 15,000 loans, with a value of approximately $630 million in the twelve months ending March 31st. Cap One has about four million credit cardholders in the UK. The acquisition is part of Cap One’s plans to diversify its business beyond the mature credit card market. In September, Capital One acquired Onyx Acceptance Corporation, a major auto loan originator, for $191 million in cash.
Capital One has signed a definitive agreement to privately held HFS Group, a major home equity loan broker in the UK. Cap One will pay $117 million in cash. HFS originated a volume of approximately 15,000 loans, with a value of approximately $630 million in the twelve months ending March 31st. Cap One has about four million credit cardholders in the UK. The acquisition is part of Cap One’s plans to diversify its business beyond the mature credit card market. In September, Capital One acquired Onyx Acceptance Corporation, a major auto loan originator, for $191 million in cash. (CF Library 9/22/04)
VA-based Chesapeake Bank has migrated to Metavante for merchant processing and related services. Services include settlement and accounting solutions, fraud detection, and online resources to assist Chesapeake’s merchants to better manage their businesses and handle its merchant portfolio. Chesapeake Bank, a Virginia State-Chartered Bank as well as a Federal Reserve and FDIC member bank, provides personal services to individuals and business in the state of Virginia. Metavante is a chief provider of electronic funds transfer and card solutions to more than 2,200 financial institutions, transportation agencies, and health insurance companies in the U.S.
Capital One has named Ann Fritz Hackett, president of the Horizon Consulting Group, to its Board of Directors. Ms. Hackett will serve on the Board’s Audit and Risk Committee and its Governance and Nominating Committee, filling a new seat on the Board. Before her career at Horizon, Hackett served as vice president and partner in strategy and human resources at Strategic Planning Associates, Inc. She serves on the board of Woodhead Industries, Inc. and formerly served on the Board of Trustees at Dartmouth College, her alma mater. Capital One Financial Corporation is a holding company with principal subsidiaries, Capital One Bank and Capital One, F.S.B. Capital One is a Fortune 500 company and one of the largest providers of MasterCard and Visa credit cards in the world.
Amerada Hess and Chase have partnered to launch a co-branded credit card that offers 10% cash back on gas purchases for the first 90 days, and 5% thereafter. Besides the gas cash back, the card offers a 1% rebate on all other purchases. The current interest rate varies between 11.74% and 17.74%, depending on credit risk. There is no annual fee. Chase has extensive experience with gas partnerships since it was the first issuer of the “Shell MasterCard” and the current issuer of the “Marathon Platinum MasterCard.” Shell also offers the “PerfectCard” which features a generous rebate on gas purchases regardless of the brand. Hess has more than 1,250 locations in 14 states on the East Coast.
Official Payments has signed a two-year contract extension with Virginia to enable residents and businesses to pay a variety of taxes electronically including the use of credit cards. The extension enables Virginia taxpayers to pay individual income and estimated taxes and notice of assessments and business bills using the Internet, telephone, or credit card through September 2006. Official Payments Corp., a wholly owned subsidiary of Tier Technologies, Inc., provides the IRS, 24 states, Washington D.C., and over 1,500 local government clients across the nation with electronic payment services. Netifice & IP Merchant Solutions
MBNA has named Thomas Murdough, chairman and CEO of the Step2 Company, to MBNA Corporation’s Board of Directors. Mr. Murdough will serve on the Audit and Compensation Committees. In 1991, Murdough launched Step2 hoping to go “a step beyond” in developing and manufacturing products for the family and home. He is a graduate of the University of Virginia and is the founder of The Little Tikes Company, which was sold to Rubbermaid in 1984. MBNA is the largest independent credit card lender in the world and is recognized as a leader in affinity marketing. It provides lending, deposit, and credit insurance products and services.
Capital One’s third quarter U.S. card profits ramped up by 50% year-over-year, as delinquency and charge-offs headed south. U.S. card outstandings of $46.1 billion are up 4% compared to one-year ago and 2% since the previous quarter. For the third quarter, COF posted net income for U.S. cards of $414.4 million, compared to $384.1 million in the second quarter, and $276.2 million one-year ago. The managed delinquency rate (30+ days) for U.S. credit cards was 4.14% for the third quarter, compared to 3.95% for 2Q/04, and 4.88% for the third quarter of 2003. The net charge-off rate for U.S. credit cards was 4.68% for the third quarter, compared to 5.19% for the second quarter, and 6.16% one-year ago. The overall managed revenue margin increased to 13.03% in the third quarter from 12.53% in the previous quarter. During the third quarter of 2004, Capital One grew its overall managed loan portfolio by $2.1 billion to $75.5 billion. The Company noted that it continues to diversify its business as 39% of total loans and 29% of earnings are now generated from businesses beyond the U.S. credit card segment. During the third quarter, Cap One sold its interest in a South African joint venture. This month, the Company sold its French loan portfolio. For complete details on Capital One’s third quarter performance visit CardData ([www.carddata.com]).
COF U.S. CARD NET INCOME
3Q/03: $276.2 million
4Q/03: $322.7 million
1Q/04: $386.8 million
2Q/04: $384.1 million
3Q/04: $414.4 million
Source: CardData (www.carddata.com)
MBNA reported that net income for the third quarter rose 10% to $728.3 million as the issuer prepares to launch American Express cards next month. Managed loans for 3Q/04 were slightly down sequentially but up 4.5% year-over-year. Third quarter charge volume was up 11% compared to 3Q/03. Total managed loans at the end of the third quarter were $117.8 billion, and charge volume was $53.0 billion, including $17.7 billion in cash advances. Managed charge-offs decreased slightly to 4.61% compared to 4.95% in the previous quarter, and 5.13% one year ago. Delinquency on managed loans increased slightly to 4.11%, compared to 4.08% in 2Q/04, and 4.48% in 3Q/03. During the quarter, MBNA added 2.3 million new accounts. MBNA indicated future growth drivers will be its new rewards program, international card business, the launch of the AmEx credit card, and its expansion into professional practice financing and insurance premium financing. For complete details on MBNA’s third quarter results visit CardData ([www.carddata.com]).
MBNA TRACK RECORD
3Q/03: $658.8 MM $112.8 B
4Q/03: $703.5 MM $118.5 B
1Q/04: $519.7 MM $117.6 B
2Q/04: $660.3 MM $118.2 B
3Q/04 $728.3 MM $117.8 B
Source: CardData (www.carddata.com)
Cleveland-based KeyCorp has signed its first surcharge-free ATM deal in West Virginia with WesBanco Bank. Key’s agent bank program enables banks, credit unions, and other financial services companies to provide customers and members surcharge-free access to Key’s ATM network without the investment needed to manage their own ATM system. Key’s nationwide network of almost 2,200 ATMs can be accessed by institutions. WesBanco’s customer service capabilities are significantly enhanced by the partnership with Key. Customers now have easy access to their accounts and can conduct business with WesBanco at home or while traveling. WesBanco, Inc. is a $3.9 billion multi-state bank holding company that provides retail and commercial, trust, investment, and insurance products and services. KeyCorp has assets of roughly $88 billion, making it one of the nation’s largest bank-based financial services companies.