UK INDEX

Moody’s Investors Service’s recent index report, “UK Credit Card Indices:
December 2007” demonstrate credit cards have made performance
improvements during the period. Charge-off and delinquency rates both
decreased in December 2007 from December 2006 to 6.04% by 133 basis
points and to 5.83% by 37 basis points, respectively. The report also
reflects
payment rates and gross yields performance with a December 2007 rate of
16.38%, down from 17.69% in November, and 19.50%, respectively. With
these findings, however, uncertainty in performance trends persist for
the latter
half of ’08 and beyond. Additionally, Moody’s reports now include
unstressed
assumption ranges, payment rates and gross yields.

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Smart Circle Cards Go Digital

Marketing and direct sale provider Smart Circle International has introduced digital format “Smart Circle Cards.” The Smart Circle’s new card, once only available to consumers in the form of a tear-away coupon card, includes an easy to use digital format that’s designed to look and function like a gift card. Among the card’s newly added features is the ability to hold multiple Smart Circle offerings from multiple businesses in one card. Once the savings are “cashed in,” consumers can reload new offers online, giving them the ability to easily stock up on their favorite discounts and incentives at their convenience. Merchants also reap a number of new rewards as well, including a convenient processing application that allows them to scan the cards digitally with standard credit card terminals and redemption capabilities which enables The Smart Circle to monitor purchases, to manage overall campaign efficiency and effectiveness.

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AFFINION & ISO

Affinion International, global affinity marketer, has been awarded the
“ISO 27001” Information Security Certification for the 2nd consecutive
time and the ISO certification for its North America operations. Nearly
50 companies in the United States carry the latter credential and 4,100
worldwide have been awarded the former. Affinion’s information security
management was awarded based on the adoption of best practice across
information security domains, risk management, security framework
operation, consistency in security requirement compliance, continuous
security management and the Organization’s published international
standard. Affinion Group helps generate incremental revenue for over
5,200 affinity partners, employs 3,000 employees and oversees
operations in the U.S. and Europe.

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WaMu and PetSmart Launch a VISA Card

WaMu and PetSmart have teamed to issue a co-branded credit card. The new “PetSmart PetPerks VISA” enables consumers to upload a photo of their pet when they apply and the image will be printed directly on their card after their application is approved. Alternatively, the customer can choose one of several standard pet-themed card designs. The card also awards three points for every dollar spent on purchases at PetSmart, PetSmart.com and Banfield, The Pet Hospital, and one point per dollar spent everywhere. Points can be redeemed for PetSmart gift cards, donations to PetSmart Charities, travel rewards and statement credits, starting at just 2,000 points. Cardholders also receive a $20 PetSmart gift card after using the card for the first time within one year. Online applicants receive 0% introductory APR for the first six months on purchases and balance transfers requested at the time of application. PetSmart operates more than 993 pet stores in the USA and Canada.

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CARIFS

Alaric International will be providing the Barbados Public Workers’
Co-operative Credit Union Ltd (BPWCCUL) with its
debit card solution. In doing so, Alaric will be providing EFT
authorization and switching for the implementation of the national
CarIFS (Caribbean Integrated Financial Services) debit solution, which
has just recently made available debit switching to credit unions.
Authentic will link the Union to the CarIFS Network while Prism Services,
the network manager, is fully endorsing the development.

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Citi Lands the DoD Travel Card Contract

Citi announced it has been selected to administer the U.S. DoD “Travel Card” program. The program, the largest under the GSA’s umbrella “SmartPay 2” master contract, currently has 1.2 million cardholders accounting for 61% of government-wide travel spending in 2007. Citi will immediately begin working with the Defense Travel Management Office and the DOD Service Commands to implement a program customized to meet their requirements, as well as to plan for an effective and smooth transition from the previous provider. The DTMO was established in 2006 to serve as the central point of contact for commercial travel within the DOD. It is responsible for establishing strategic direction and managing all commercial travel programs, including the travel card program. The new official travel cards will activate on November 30th.

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Q4 CARD SURVEY

The Hong Kong Monetary Authority has published its 4Q07
credit card lending survey, reflecting an 8.8% increase in card
receivables, due largely to salaries tax payments, and a 1.6% increase
in total cards issued. Moreover, since 3Q07, the survey demonstrates
the amount customers spent with their credit cards reached HK$24.6
billion, up HK$.2 billion, the charge-off amount dropped HK$38 million
and the annualized charge-off ratio dropped by .37%. Also for 4Q07,
the delinquency ratio dropped to 0.35% and rescheduled receivables
remained at HK$52 million, while the combination of the 2 ratios
declined to 0.42%.

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OpSource Level 1 PC1 DSS Compliant

CA-based OpSource has announced “Level One” compliance with the “PCI DSS.” In order to successfully comply with the Level One PCI DSS, merchants and service providers must demonstrate compliance with 12 requirements in categories such as building and maintaining a secure network, protecting cardholder data, maintaining a vulnerability management program and maintaining an information security policy. As a Level One service provider, OpSource demonstrated its compliance by successfully undergoing a stringent, annual, on-site PCI data security review covering over 250 compliance points. OpSource delivers Web applications and software-as-a-service for on-demand companies.

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DAVID JONES & AMEX

For its general purpose credit card, David Jones has decided to partner
with American Express. Following David Jones’ evaluation for the assurance
of the most beneficial terms of an alliance, this partnership also
includes the
transfer of David Jones’ receivables to the card company and the launch of
a partnership card by the end of 2008. Under the terms of agreement, the
David Jones American Express card can be used wherever in the world
American Express is accepted and offers gift reward points intent on
generating
subsequent new accounts throughout Australia. The Australian credit card
market is a promising one in which to support the new David Jones credit
card given its annual receivable of $36.9 billion, 11.8 million accounts and
strong growth at nearly 18% per annum. The American Express merchant
network provides products/services designed to appeal to over 80% of
card member spending needs, David Jones employs over 10,000
and is projected to generate approximately $38 million before 2013 as a
result of the aforementioned agreements.

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NOV DEBT

Credit card debt climbed again in November setting a new record of A$41.9 billion. Credit card volume slipped slightly to A$18.3 billion after hitting a new high in the prior month. Year-on-year credit card debt has increased 10.3%, compared to November 2006. Card volume is up 11.6% compared to one-year ago. Credit card limits also reached a new high at A$113.4 billion, marking the 15th consecutive month of A$100+ billion. According to the Reserve Bank of Australia there are currently 13.9 million credit card and charge card accounts in Australia, compared to 13.2 million one-year ago.

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GLOBALPLATFORM CARD V 2.1.1

The GlobalPlatform smart card specifications body has decided to make available
its technical documents, including the “Card version 2.1.1,” “v2.2 Mapping
Guidelines of Existing v2.1.1 Implementations” and its “Card Benchmark v1.0
Specifications,” for purchase by non-member organizations. This development
is in response to the Organization’s desire for widespread
implementation of
its specifications in response to the needs of worldwide markets.
GlobalPlatform is a member driven association which provides smart card
infrastructure development across various industries around the world.

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