HSBC NORTH AMERICA

HSBC Bank Canada has made agreements with HSBC Finance Corporation for
the acquisition of HSBC Financial Corporation Limited. HSBC Financial offers a diversified range of consumer financial services to the Canadian public, including consumer loans, mortgages and private label credit cards. This development is the direct result of an ongoing strategic review of the Group’s North
American operations and is expected to close by the conclusion of 2008.
HSBC Bank Canada has more than 180 offices throughout Canada with total
assets of nearly C$67.4 billion and a net income of C$297 million while
HSBC Financial Corporation Limited has total assets of nearly C$5.2
billion with a net income of C$26 million, 10,000 offices in 83
countries and assets of US$2.4 billion.

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NPC Hires a Former NOVA Top Executive

KY-based payment processor NPC and equity investment firm GTCR have
announced that Steve Stevenson, previously with NOVA, is the new CFO of
NPC. Stevenson will report directly to Tom A. Wimsett, NPC President
and CEO. Stevenson has spent over 20 years in the payment processing
industry as a senior finance and accounting executive. During his tenure
at NOVA as EVP and CFO, Stevenson was a key member of the executive team
that grew revenues from approximately
$400 million to over $1.2 billion. Prior to NOVA, Stevenson spent two
years as the CFO for LYNK Systems. Before joining LYNK, he spent twelve
years as the Controller and interim CFO at National Data Corporation,
the predecessor to Global Payments. NPC provides a
wide range of business transaction processing, from point-of-sale credit
card processing to e-commerce solutions. These
services include the electronic acceptance of credit, debit, gift and
loyalty cards, and electronic checks.

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TNB Names a New Product Senior Exec

TNB Card Services has named Mitch Raymond, previously with Citigroup,
as SVP of product development. At Citigroup, he most recently served as
VP, senior operations manager. During his time at Citi, he was
responsible for leading a large team of associates in the delivery of
customer service and collections activities for large corporate and
government accounts. Prior to Citi, Raymond held a variety of roles in
product development, marketing, operations and finance at Dell Financial
Services L.P., GE Capital Corporation, and Exxon Co. USA.
Raymond will work closely with TNB’s clients and executive leadership
team to design, develop, and implement products and services that will
strengthen its credit union clients’ ability to effectively manage and
grow their card portfolios.

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Credit Card ABS Excess Spread Narrows

Credit card Asset Backed Securities are continuing to face pressure as excess spread levels have decreased by 4% among prime portfolios and 42% among sub-prime portfolios. Increased borrower debt reload rates, and lack of alternative debt refinancing options are steadily chipping away at this cushion in ABS. Fitch Ratings this continued compression could begin to put pressure on subordinated debt ratings. Fitch expects charge-off rates in the prime credit card segment may approach the high end of historically observed performance averages, meeting or exceeding 7% by year end. Charge-off rates in Fitch’s prime credit card index have risen for the ninth straight month, up 40% on a year-over-year basis.

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Intermec CN3 to Use CHARGE Anywhere

POS solution provider CHARGE Anywhere announced the availability of
“CHARGE Anywhere POS Software” for use on the wireless “Intermec
CN3 rugged mobile computer”. The
Intermec CN3 mobile computer with CHARGE Anywhere Software provides a
secure, PCI compliant mobile POS solution that will allow merchants to
process credit card payments in any environment with a
PCI PABP validated secure payment application. The touch screen on the
CN3 along with the functionality of the CHARGE Anywhere Software
and Transaction Manager online application will make it possible for all
merchants to capture signatures on the device then review and print them
at a later time online, completely
eliminating the need to physically store receipts.

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June ABS Payment Rates and Yield Improve

Monthly payment rates, the amount that cardholders pay on their credit card debt, made a significant uptick in June. Portfolio yield, among credit card- asset backed securities, also began showing signs of improvement in June. The MPR ABS rose 89% basis points to 19.54%, but remains down three basis points from one-year ago. According to FitchRatings, the gross yield increased in June to 17.42%% from 17.27% in May, but remains down eight basis points from June 2007.

ABS METRICS
YIELD MPR
Mar 07: 18.21% 18.76%
Apr 07: 19.23% 21.09%
May 07: 18.23% 19.58%
Jun 07: 18.94% 20.17%
Jul 07: 18.46% 20.46%
Aug 07: 19.27% 20.88%
Sep 07: 19.61% 20.99%
Oct 07: 18.83% 19.09%
Nov 07: 19.44% 20.31%
Dec 07: 19.92% 19.09%
Jan 08: 19.11% 17.64%
Feb 08: 20.46% 18.00%
Mar 08: 18.61% 18.50%
Source: FitchRatings

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Most U.S. Parents Prefer Teen Prepaid Cards

New research among teens and their parents concludes that prepaid debit cards can help kids maintain a “cool” status while making payments easier, providing payment security and control for parents. According to Mintel Comperemedia 62% of parents are interested in having their children use a prepaid debit card rather than a credit card. Additional benefits Mintel research has concluded is prepaid cards offers teen-friendly features with no risk of overdraft fees, users can only spend the amount of money pre-paid onto the card and provide the opportunity to build credit. Also, many prepaid cards come with safety features like allowing parents to monitor spending or requiring authorization for online use.

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Merchant Acquiring Faces Many Challenges

New research suggest that the merchant acquiring side of the payments industry is facing unprecedented challenges. Mercator Advisory Group says the proposed legislation to regulate merchant costs of card
acceptance is of chief concern. Cumulatively, the presence of regulatory
and legislative scrutiny on the acquiring side of the bankcard space has
never been more intense. There has also seen the beginning of the dissolution and division into two pieces of the largest merchant acquiring venture in the world. Mercator notes that the industry is also uncertain about the effects of a potential recession in the U.S. economy and what that means for electronic payments. From one perspective, the overall electronification of payments in general bodes well for those managing the opportunity. On the other hand, if the overall power of the US consumer diminishes, electronification may not make much difference in the acquirer’s bottom line.

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M&S AND POSTILION

Marks & Spencer has launched a gift card solution based on S1
Corporation’s “Postilion” software solutions. The “Postilion Card
Issuer” solution will allow Marks & Spencer to manage the entire life
cycle of their gift cards for the control of issuing, authorization, and
account management of individual and batches of gift cards. The gift
cards are identified either by a magnetic stripe or a barcode, are
loaded at the time of purchase and offer a solution for issuance and
management in multiple currencies. The Marks & Spencer gift card program
was first launched in all UK stores in November 2007 while the store
employs over 75,000 people at its 643 stores in the UK and 258 stores in
40 territories globally while Postilion has over 1,500 customers in more
than 50 countries, operates over 100,000 ATMs and 500,000 POS terminals
worldwide.

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Visa and Elan Sends Two to the Olympics

Visa and Elan Financial Services will send two of Elan’s clients off to
the Beijing 2008 Olympic Games. Each employee who sold five or more
approved and booked credit cards during the promotion was entered in to
a random drawing to win one of the two trips to the Olympic Games. Twice
a year, Elan and Visa team up to provide Elan clients an opportunity to
participate in promotions that offer unique experiences. All Elan
clients had an opportunity to participate in the two-month-long Visa
Olympic Games promotion. Elan Financial Services is a provider of
complete outsourced solutions with a focus on payments and card
processing.

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U.S. House Committee Approves HR 5244

The House Financial Services Committee
has approved measures on H.R. 5244, Credit Cardholders’ Bill of Rights Act of 2008.
The Credit Cardholders’ Bill of Rights will help level the playing field
between credit card companies and cardholders. It allows for
cardholders say “no” to interest rate increases and prohibits card
companies from luring people into paying high rates and fees.

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