Yield Stays Healthy Despite Rising Rates

After rising in December to 18.28%, the yield on credit card portfolios slipped by 27 basis points in January, but remain 8 basis points higher than one-year ago. The healthy yield amidst a rising interest rate climate has been attributed largely to strong fee income. Variable interest rates also have propped-up the yield as issuers pass through any increases within one billing cycle. According to Moody’s Investor Services the yield for January among credit card-backed bonds was 18.01%, compared to 17.93% one-year ago.

ABS YIELD HISTORICAL
Jan 05: 17.93%
Jul 05: 18.33%
Sep 05: 17.78%
Dec 05: 18.28%
Jan 06: 18.01%
Source: Moody’s Investor Services

Details

Fifth Third Lands a Marshall & Ilsley Exec

Fifth Third Bancorp has landed John Presley, formerly CFO of Marshall & Ilsley, to head up the strategic initiatives position. Prior to his role at M&I, Presley served as chief financial officer for National Commerce Financial in Memphis and prior to that was president and chief executive officer for First Market Bank in Richmond, Virginia. Earlier in his career, he served as controller and MIS manager at National Commerce Bancorporation. A native of Little Rock, Arkansas, Presley holds a Bachelor of Arts degree in Economics and Business Administration from Rhodes College in Memphis (formerly Southwestern at Memphis.)

Details

FLEXI VISA

Garanti Bank has launched a new line of credit cards that enables
cardholders to create a card with the interest rate, the reward system,
the card fee and even the card design of their choice. The new “Flexi
VISA” cards offers more than 9,000 different financial combination
possibilities. During the application process on the Web, applicants can
manipulate over ten parameters such as the reward rate and type,
interest rate, card fee, and campaign type to create their preferred
combination. Customers who want a simple approach can choose to select
one of the four ready made packages from the Web or from
Garanti branches. Cardholders can choose from among five different color
designs of “Flexi.” They can also choose a picture from the photo
gallery or they can use a picture of their own. Cardholders can also
choose the vertical VISA card, the first offered vertical VISA to be
offered. All the software needed for the program was developed in house
by Garanti’s technology company. Garanti also issues the highly
successful “Bonus VISA” cards with more than four million cardholders
to-date.

Details

Optimal Payments CEO Resigns

Montreal-based Optimal Group announced that Mitchell Garber, executive vice-president of Optimal Group, president and chief executive officer of Optimal Payments Inc. and executive chairman of FireOne Group plc has resigned, effective immediately, to pursue other opportunities within the Internet gaming sector. Benjamin Dalfen has been named chief executive officer of FireOne Group. Douglas Lewin has been named president of Optimal Payments. Optimal Payments processes credit card payments for Internet businesses, mail-order/telephone-order and retail point-of-sale merchants, and process electronic checks and direct debits online and by phone.

Details

Retail Decisions 2005 Profit Up 31%

Retail Decisions reported that revenue climbed 72% last year to GBP 54.7 million. Pre-tax profits rose 31% to GBP 8 million. ReD says “Card Not
Present” fraud prevention is a major growth area, growing 50%
organically in transaction volumes year-on-year. ReD’s fuel card
operation is the largest multi-branded card business in Australia
accepted at nearly all of the 6,500 fuel stations throughout the country
and at around 8,250 other outlets that provide services for business
drivers. In the UK and Europe, ReD’s fuel card business, known as “ReD
Fuel Cards,” is the UK’s second largest operator in the independent fuel
card market with over 65,000 cards in issue and around 6,300 live
customer accounts. In December, ReD acquired E Com, Australia’s largest
pre-paid card operator. For more details on ReD’s latest results, visit
CardData (www.carddata.com).

Details

VeriFone Vx Solutions Tops 500K Units

San Jose-based VeriFone reports it has topped 500,000 unit sales of its new “Vx Solutions” payment systems line over the past twelve months. Available beginning early in 2005, Vx Solutions has experienced broad international success, notably in markets where modernization efforts have accelerated the transition to electronic payment systems. VeriFone Holdings is a leader in secure electronic payment technologies, provides expertise, solutions and services for today with a migration strategy for tomorrow.

Details

Credit Card Restrictions Jeopardize Charities

The Institute of Fundraising has issued a warning to all
fundraising organizations that accept credit or debit card donations to
contact their acquiring bank, following the issuance of a mandate from
VISA and Mastercard. The Institute of Fundraising is expressing concern
about the absence of any consultation process with charities and lack of
clear guidance about these developments. The mandate will require
charities to capture the three-digit card security code when accepting
donations from cardholders that are not present. Failure to collect
this code may result in the acquiring bank’s refusal to process
donations. These changes come into effect early as April 2006.

Details

Pago to Offer Giropay Next Month

Cologne-based Pago will offer “giropay,” a new payment
method similar to the online bank transfer, beginning in April. “Giropay” is based on conventional home banking procedures, allowing consumers to pay for online purchases by directly initiating fund transfers directly using familiar PIN and TAN procedures. A consortium of German banks including the PostBank, the Sparkassen Finanzgruppe (Association of German public sector savings banks) and the IT service providers for the Volksbanks and Raiffeissenbanks, Fiducia IT and GAD, has developed the new payment method which was officially unveiled in mid-February. The Pago “Online Bank Transfer,” which has been available since 2003, is also based on the PIN/TAN procedures and can be used by customers of over 2,000 banks in Germany.

Details

MasterCard Exec Joins Asia Pay Board

Asia Pay announced that Rosaline Tam has been appointed to its Board of Directors. Tam
has over 25 years’ experience in financial services technology including
senior management positions with MasterCard International, Citibank and
American Express. Tam currently serves as a director of Richwap Company
Limited. Previously, Tam was with MasterCard
International, serving as the Vice President and General Manager for
Hong Kong and Macau as well as the Vice President for Advance Payments,
e-Business and Mobile Commerce for Greater China. She led MasterCard
International to gain significant market share, both in terms of the
number of cards issued and card spending. She also led the company to
achieve a threefold growth in revenue in the midst of the Asian economic
crisis. Asia Pay is developing a credit card processing network to facilitate transactions between merchants and financial
institutions in China, Japan, and other markets in Asia.

Details

Consumer Protection Kick Off Fraud Prevention Month

Officials from the U.S. Federal Trade Commission and Canadian consumer
protection agencies met to kick off March as “Fraud
Prevention Month.” The initiative is part of an international effort to
raise public awareness worldwide of the dangers of fraud, while
educating the public on how to recognize and report it. As part of the
initiative, the FTC today is launching a new section
about cross-border online fraud on www.OnGuardOnline.gov, an educational
site with information to help computer users be safe online.

Details