Capital One Financial Corporation announced that Steve Linehan has been named Treasurer of Capital One. In this new role Linehan is responsible for Capital One’s overall balance sheet management strategy and for coordinating its global funding and treasury operations across all lines of business.
Fifth Third Bancorp has deployed Financial Fusion’s “Consumer Banking Solution” for banking and bill payment, alerts and bill payment and transfer warehouse. Financial Fusion provides integrated financial solutions to more than 200 of the world’s leading financial institutions.
Capital One has lined-up a new CFO to take over July 1st. Gary Perlin, former SVP/CFO of World Bank, will join Cap One as EVP/CFO. Perlin spent 13 years at World Bank. He also spent four years on Wall Street and more than 11 years at Fannie Mae. Perlin will also serve as a member of Capital One’s Executive Committee. The Executive Committee, chaired by Fairbank, is comprised of the heads of key business lines and principal operating and functional groups. In March, Capital One confirmed that its former CFO, David Willey, received a “Wells” notice from the SEC and resigned. (CF Library 7/22/02; 3/4/03)
Capital One’s AmeriFee subsidiary has introduced a 5.9% APR consumer-loan plan to finance personal orthodontic, dental, vision, cosmetic and fertility procedures. While the new low rate program should appeal to patients, it is expected to offer benefits to medical practitioners as well.
National Processing Company, LLC. , a leading provider of payment settlement services and a wholly owned subsidiary of National Processing, Inc., announced the signing of a multi-year, strategic co-marketing agreement with Payerpath, Inc., a leading provider of Internet-based financial transaction solutions for healthcare providers and payers.
Capital One announced it has revamped its “MilesOne Rewards” card. In addition to earning miles for airline travel, consumers now have a choice of redeeming miles for one percent cash-back, electronics and merchandise, gift certificates at select merchants or donations to a charitable organization. Under the “MilesOne” program, miles are redeemable on any U.S.-based airline, with no blackout dates or seat restrictions. The new cash-back feature enables cardholders to earn one-percent cash back for miles. Miles can also be redeemed miles for gift certificates from retailers such as Banana Republic, Bloomingdales and J. Crew. Miles can be donated to charities such as the Habitat for Humanity; Christian Children’s Fund; United States fund for UNICEF; or St. Jude’s Children’s Research Hospital. The card was first introduced in 1998.
San Diego-based Cubic Transportation Systems and Atlanta’s Metropolitan Atlanta Rapid Transit Authority have begun negotiations on a $100 million contract to upgrade the city’s fare collection system with smart card technology. Cubic says the proposed upgraded MARTA system could eventually be linked to other Atlanta-area transit agencies, as well as toll roads and airport parking facilities, providing “intermodal” fare collection in the area. Cubic is already creating such a regional system in the Washington, D.C. area, where smart cards are used for rail, bus and parking, and some employers credit their employees’ transit benefits directly on the transit cards. Cubic is linking the smart card system to 16 other bus and rail agencies in Virginia and Maryland. Under recently awarded contracts, the company is also creating regional smart card systems in Los Angeles and San Diego. Cubic expects negotiations with MARTA to be completed by the end of the summer.
Capital One posted its first profit for its international credit card accounts portfolio during the first quarter. The issuer posted 1Q/03 net income of $18.1 million, compared to a $6.2 million loss in the fourth quarter, and an $8.5 million loss one year ago. Since the first quarter of 2002, Capital One’s international portfolio outstandings have grown 27.3%, from $4.2 billion to $5.4 billion. Charge-offs for the first quarter of this year was 4.28%, compared to 3.92% in the fourth quarter, and 3.58% one year ago. International delinquency for the first quarter of this year was 4.22%, compared to 4.18% in the fourth quarter, and 4.08% one year ago. Capital One noted that its UK operations became profitable for the first time last year. At the end of 2002, the U.K. Bank had 2.8 million accounts and $3.9 billion in credit card, revolving loan, and installment loan assets.The UK Bank has been operating independently in France since 2000. Besides the UK, the issuer also has operations and activities in Canada, South Africa and France.
Capital One’s President and COO is setting the stage for a departure from an executive management role at the company by the end of this year. After 15-years of building Cap One with long-time business partner and CEO Richard Fairbank, Nigel Morris will become Vice Chairman of the Board of Directors, effective May 1st, stepping down as President and Chief Operating Officer. Morris says he wants to spend more time with his family and to pursue personal interests. As Vice Chairman, Morris will continue to be responsible for the company’s international business and its enterprise-wide risk management activities as well as communicating to the company’s external audiences. In addition, the company announced the creation of an Executive Committee comprised of the heads of key business lines and principal operating and functional groups, which will take on the company’s key cross-functional management and operating responsibilities. Morris will serve on this committee in his new role. The Executive Committee will be chaired by CEO/Chairman Richard Fairbank.
Capital One yesterday reported strong profits in the first quarter of $309 million, compared to $188 million one year ago. However, the steep rise in profits was accompanied by a $112 million decline in quarterly marketing expenses. Marketing expense for 1Q/03 was $241.7 million compared to $353.5 million in the same period of the prior year. As the issuer shifts its focus up-market, away from the sub-prime market, the number of accounts have declined. Cap One reported it lost nearly one million accounts during the first quarter, ending at 46.4 million. The company’s managed loan balances ended the quarter at $59.2 billion, a 21.9% increase over 1Q/02. U.S. consumer loans, mostly credit cards, accounted for $46 billion of the total. The managed charge-off rate increased to 6.47% in the first quarter, compared to 6.21% in the previous quarter, and 4.70% one year ago. The managed delinquency rate declined to 4.97% for 1Q/03, from 5.60% in 4Q/02, but remained higher than 1Q/02’s 4.80%. For complete details on Cap One’s first quarter performance visit CardData ([www.carddata.com]).
Capital One Financial Corporation announced it has retained the services of McCann-Erickson Worldwide as its new advertising agency of record to handle all advertising responsibilities, effectively immediately.The agency will seek to leverage and evolve the company’s existing best-in-class campaign to improve upon its success, both in the U.S. and abroad.
Encore Cooperative and Primax Payment Systems have formed Encore Merchant Services. Encore Merchant Services will offer credit unions throughout the United States merchant processing services.