JULY CARD DEBT

New borrowing on credit cards contracted for the third straight month,
dipping by more than GBP 300 million in July. For the first half of this
year the average monthly contraction is running about GBP 100 million.
During May new credit card lending decreased by GBP 251 million and in
June is fell GBP 245 million. The British Bankers Association reports
that total new borrowing on credit cards hit GBP 7.083 billion in July,
the lowest July figure since 2002. With repayments exceeding spending
and after seasonal adjustment, net lending contracted by GBP 348
million, continuing the recent subdued picture of demand. The BBA also
noted that underlying net mortgage lending rose by GBP 5.7 billion in
July, compared with GBP 5.6 billion in June, an average of GBP 5.3
billion over recent months and GBP 4.0 billion in July 2005. The BBA
collects data from Abbey National, Alliance & Leicester, Barclays,
Bradford & Bingley, HBOS, HSBC Bank, Lloyds TSB, Northern Rock and The
Royal Bank of Scotland.

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HSA Market Poised for Rapid Growth

A new study forecasts that large banks will support 40% of the health savings accounts market by 2010, up from 20% this year. Boston-based Aite Group also forecasts that specialty banks will support about 35% of the HSA market by 2010, up from 30% in 2006. The market currently represents about 1.9 million HSAs, but Aite Group is forecasting it to reach 11.2 million by 2010. The researcher says HSAs represent the first intersection of three different aspects of the financial services industry: banking, health insurance and investments. Aite also notes that the IRS and the U.S. Treasury will likely continue to issue periodic guidance on HSAs, but they are not likely to do anything that would suppress demand.

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Banks Most Trustworthy with Data

A new poll has found that 66% of consumers identified banks as the most trustworthy with their personal information. In a distant second place, government agencies received 11% of the vote, and universities were third with 10%. Retailers and data brokers garnered 3% and 2%, respectively. The American Bankers Association says its poll, conducted last month by Ipsos Reid, reflects the low incidence of data breaches at banks versus merchants.

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Oregon Bank Offers Coinstar’s Card Line

OR-based West Coast Bank is now offering customers the Coinstar line of gift card, prepaid wireless, cash card, and phone card products. Included in the product line are gift cards from top food, entertainment and retail businesses such as Chili’s, Borders(R), Starbucks(R), Circuit City(R), AMC Theatres(R), KB Toys(TM), and Timberland(R). Coinstar, Inc. (Nasdaq: CSTR) is a multi-national company offering a range of 4th Wall(TM) solutions for the retailers’ front of store consisting of self-service coin counting, electronic payment solutions, entertainment services and self-service DVD rental. West Coast Bancorp (Nasdaq: WCBO), one of Oregon Business Magazine’s 100 Best Companies to Work For, is a Northwest bank holding company with $2.3 billion in assets, operating 56 offices in Oregon and Washington.

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LINK & PULSE

LINK Interchange Network, the operator of the “UK Cash Machine Network,” announced a reciprocal agreement with PULSE that will allow the 4,200 financial institution participants in the PULSE ATM/debit network to offer their cardholders access to all but a handful of the more than 58,000 cash machines across the U.K. The deal will also allow LINK to offer its 38 participating financial institution members access to an additional 250,000 PULSE cash machines in the USA. PULSE and
LINK are working to enable the first live transactions early in 2007. The agreement allows PULSE and LINK issuers to opt into the program.

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