ABS MPR Holds to its Historical Levels

Monthly payment rates, the amount that cardholders pay on their credit card debt, rose for the third month in July. Among credit card-backed securities, the MPR hit 20.46% in July after dipping to 19.58% in May. The MPR has remained fairly stable in the first and second quarters and remains consistent with historical levels. According to FitchRatings, the gross yield decreased to 18.46% in July from 18.94% in June and was up 83 basis points above year-ago levels. Fitch says that despite the decline in yield this month, gross yield for 2007 has been significantly higher and the difference in year-over-year levels is increasing; the difference in first-quarter average gross yield in 2006 and 2007 was just 25 bps, compared with the 2006 and 2007 second-quarter average of a 183-bp difference.

ABS METRICS
YIELD MPR
Jul 06: 17.63% 20.71%
Aug 06: 17.86% 20.24%
Sep 06: 17.96% 21.06%
Oct 06: 17.58% 19.30%
Nov 06: 17.96% 19.82%
Dec 06: 17.78% 19.32%
Jan 07: 18.28% 19.27%
Feb 07: 17.70% 20.80%
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%
Source: FitchRatings

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HALYK BANK & CR2

Halyk Bank of Kazakhstan has implemented CR2’s multichannel, self-
service solution, “BankWorld”, for the bank’s ATM, Internet, kiosk, and
mobile phone customer service channels. “BankWorld” Internet sites have
increased by over 100% since last year and for Halyk Bank, the CR2
solution will allow customers to personalize their self service products
and services. Subsequently, this is projected to create an increase in
cross
selling and customer satisfaction. This development comes at the end of a
successful, CR2 fiscal year reflecting a license sales increase of 40% on
the previous year with new customers from around the globe.

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Gander Mountain PC Theft Compromises Data

MN-based outdoor gear specialist Gander Mountain this week confirmed a possible theft of a Pennsylvania store computer. The Company reported that a computer from its Greensburg, PA may have been breached. The stored transaction information may have included 112,000 credit card numbers with expiration date but without any other associated information. Approximately 10,000 transaction records may have included the credit card number, expiration date and customer name. For the approximately 5,100 credit card customers who returned merchandise or did a lay-away purchase at the store during this period, the information also may have included an address. For the approximately 650 customers who purchased by check and returned merchandise without a receipt or put merchandise on lay-away by check payment, the information may have contained a name, address, driver’s license number and date of birth. The company has sent letters to the approximately 5,750 customers for whom address information is available informing them of this incident.

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EVERTEC & FAC

First Atlantic Commerce (FAC) has certified EVERTEC’s e-commerce
processing platform for Puerto Rican customers, which allows FAC to
process transactions with all banks on the platform. This development will
also allow acquiring banks in the Latin American Caribbean Region to
implement FAC e-commerce card payment solutions. Through EVERTEC
and its e-commerce processing platform, FAC is provided an application to
connect payment gateways and merchants with Credit and Debit Card
Associations. This also allows FAC to provide online payment and risk
management solutions. EVERTEC solutions are applied in 15 different
countries
across many different industries, executes over 920 million transactions
yearly
on a network of over 4,300 ATMs and over 85,000 POS terminals, and has
over 1,700 employees working in 7 countries. FAC merchant platforms include
Microsoft, UNIX, and LINUX.

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Minnesota Casinos Pick GPN’s VIP LightSpeed

Global Payments has signed an agreement to provide its “VIP LightSpeed” suite of cash access products to Mystic Lake Casino Hotel and Little Six Casino in Minneapolis/St. Paul, Minnesota. “VIP LightSpeed” is a high speed, Internet-accessible, PC-based platform that provides cash access services. The casinos will also utilize Global Payments’ PlayerCash @dvantage credit and debit card cash advance services to provide cash access from all major payment card networks, 24 hours a day, seven days a week. Global Payments is a provider of electronic transaction processing services.

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ALRC DEFAULT RATES

The Australian Law Reform Commission (ALRC) has recommended
a revision to the Privacy Act that encourages the disclosure of more
information on national consumer credit reports. This potential
amendment to the existing credit-reporting model is led by Dun &
Bradstreet (D&B) for the improvement of default rates and to allow
greater credit access to those less privileged. Specifically,
D&B is recommending that credit reports reflect the type of current
credit accounts opened, the date current credit accounts were opened,
the credit limit and the date credit accounts are closed. Based on
research,
this reform will have macro-economic benefits with contributions of $5.3
billion over the next decade to the economy, default rate improvement,
and more credit extensions to the under-represented such small business,
young people with good payment histories, and women.

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MasterCard’s Paypass Comes to the UAE

Emirates Bank this week officially launched “MasterCard PayPass” contactless technology in Dubai. Merchants in Dubai Internet City, Dubai Media City, and Dubai Knowledge Village will accept the new payment option. The new “Emirates Bank DIC MasterCard” will be accepted by fast-food outlets, coffee shops, convenience stores and pharmacies. It is the first co-branded contactless payment card to be offered in the Gulf. In Europe, the first “MasterCard PayPass” credit program was launched with Garanti Bank and major retailers in Turkey in June 2006, with the bank’s subsequent rollout of the region’s first “PayPass”-enabled wristwatch in spring 2007.

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CITIC AMEX CARD

China CITIC Bank and American Express have launched a rewards card
in Beijing targeting frequent business travelers. The new product is a
multi-
currency card offered in both classic and gold versions. The “CITIC
American Express” card has a reward points multiplier, flexible travel
rewards redemption, unique travel experience, golfing privileges at
six exclusive courses in China, local merchant privileges, secured online
shopping platform access and comprehensive insurance coverage.
China CITIC Bank was established in 1987 and has been ranked on
the list of “Top 100 Chinese Banks” for 2006 and 2nd among all the
commercial banks in net profit growth rate. American Express has
established over 110 card-issuing partnership arrangements in over 120
countries.

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MegaPath VPN Secures Rumbi Island Grill

IP voice data provider MegaPath is providing casual dining Rumbi Island Grill “SecureConnect Site-to-Site VPN” and “SecureConnect Managed Security” services to protect network assets and customer credit card transactions across its 22 locations. The MegaPath SecureConnect Site-to-Site VPN service delivers enhanced performance and secure communications, allowing Rumbi to increase productivity and grow its business. The SecureConnect Managed Security service protects Rumbi’s business information and systems from both internal and external threats through a Unified Threat Management (UTM) solution, which includes Managed Firewall, Anti-Virus, Anti-Spam, Anti-Spyware, Intrusion Prevention and Web Filtering.

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CAB FEEDBACK

Debt inquiries at Citizens Advice Bureau(CAB) have increased by 20%
over the past year bringing the total number of debt issues for 2006-07
to 1.7 million. Additionally, the number of debt inquiries has doubled over
the past 10 years, to 40% of the CAB debt caseload, and has become
the primary topic of inquires at a rate of 6,600 per business day. Of
these inquiries, 25% are regarding credit and store cards. Overall, calls
regarding debt of all kinds has increased by 14%, unsecured loan
questions increased by 18% and bankruptcy increased 50%. CAB
offers consumers free, independent and expert debt advice in the UK on
a range of issues.

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PCI Council Takes Over the PED Standards

The PCI Security Standards Council has assumed responsibility for the “PED Security Requirements” that were previously administered under the auspices of JCB, MasterCard International and VISA International.With the PED Security Requirements administered by the Council, all founding payment brands will recognize PED certification; streamlining the testing process, reducing costs for vendors, and leading to the proliferation of a wider selection of PED products. PED manufacturers submitting devices for security testing will be able to rely on a single set of requirements, helping ensure cardholder security and providing opportunities for faster deployment. Under the Council’s stewardship, each payment brand will bring its own PED expertise and this, when combined with market feedback from POS and terminal vendors will help strengthen the evolving security of these devices.

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CITI 3-IN-1

Citibank has introduced a 3-in-1 card, the “SMRT Visa Platinum
Debit Card,” to combine “EZ-Link”, debit/ATM functionality and Visa
Platinum card privileges for Singaporean customers. The Citibank “Tap
& Save” Account provides ATM access to more than 820,000 Citibank,
Visa and PLUS ATMs worldwide. “EZ-Link” allows customers to pay
commuter fares on public transportation with auto-draft of S$30 from
their “Tap & Save” Account when the balance reaches $0. “Tap & Save”
offers a base interest of 0.30% p.a. with a “step-up” interest of 0.10%
each month and requires a minimum initial deposit of S$500. Citi has
nearly 200 million customer accounts in over 100 countries.

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