MBNA reported this morning that it has already issued more than 300,000 American Express-branded cards to-date from initial pre-selling efforts. MBNA is now taking the “MBNA Affinity Rewards American Express” card to members of more than 1,000 affinity groups in the USA. Some of the affinity groups include the Aircraft Owners and Pilots Association, the American Society of Civil Engineers, the American Quarter Horse Association, National Education Association, and, the National Wildlife Federation. The new MBNA-AmEx card offers complimentary enrollment in “MBNA WorldPoints,” earning one point for every purchase, and double points for travel and dining until 2006. Cardholders receive access to American Express services including emergency assistance services offered at 1,700 AmEx location in 130 countries, travel accident insurance, CDW coverage, and fraud protection. AmEx is also providing cardholders with special offers from nearly 100 retailers. MBNA says it plans to develop a premium line of AmEx-branded cards next year. MBNA is the first U.S. bank to issue credit cards accepted on the AmEx network. Under the terms of the partnership, MBNA manages the customer accounts and receivables, and provides all customer service, billing and payment systems, accounting support, credit and fraud resolution, and card marketing.Details
MasterCard announced that three co-brand card programs from Asia/Pacific have been inducted into its new “Winners’ Circle.” “Coles Myer Source MasterCard,” “Virgin Money MasterCard” from Australia, and the “Vanke Real Estate Co-Brand” from China received the inaugural award that recognizes partners for excellence in co-branding. The “Coles Myer Source MasterCard” is the fastest growing credit card in Australia, with over 470,000 cards issued since its launch in October 2003. The card is also the only no fee gold card in Australia. The “Virgin Money MasterCard” offers low pricing and an instant rewards program, attracting over 500,000 new applicants within the first nine months. The “Vanke Real Estate” co-brand was launched in more than six cities including Beijing, Shanghai, Shenzhen, Jiangsu, Liaoning, and Hubei. It has issued 30,000 cards to-date since September 2003, making it one of China’s most successful programs.Details
Global Cash Access posted third quarter revenues of $106.5 million, a 15% increase over 3Q/03, and the highest amount for any quarter since the Company was formed in 1998. However, net income in the third quarter was $6.7 million as compared to $16.2 million in the comparable 2003 period, due to one-time expenses. Cash advance revenues were up 16.7% to $55.8 million. Revenues from credit card advances increased 12.8% while revenues from debit card advances increased 63.4%. ATM revenues increased 15.7%, to $41.2 million in the third quarter. The increase in revenue in cash advance and ATM was driven by increases in both the number of transactions and the average transaction amount. Check cashing revenues in the third quarter were up 2.0% to $6.5 million. For complete details on GCA’s third quarter performance visit CardData ([www.carddata.com]).
“Platinum MasterCards” went to a new level with the introduction of a series of “Jewel Cards.” The new “MasterCard Jewel Cards” are sleekly designed card cases encrusted with a variety of glittering precious and semi-precious stones in different settings. Each “Jewel
Card” case comes with a unique clip mechanism allowing cardholders to
insert their MasterCard cards into the case of their choice. There are
a total of 13 designs, two of which are designed for men. The new card cases were unveiled in in Bangkok.
The competition between VISA and American Express turned-up a notch as VISA unveiled a new consumer rewards-focused credit platform. The new “VISA Traditional Rewards” program provides certain minimum rewards requirements for VISA consumer credit rewards products. Each card that qualifies for “VISA Traditional Rewards” will be required to offer a certain rewards value to cardholders – including at least airline flight rewards or cash equivalency. Issuers can differentiate their portfolios with additional types of rewards offerings. In conjunction with the new rewards platform, VISA announced a new fee structure for “VISA Traditional Rewards” and “VISA Signature” that will, on average, increase the interchange reimbursement fee for rewards-based VISA credit products by 6.5%. VISA also announced it will now permit certain merchants to enter the “CVV2” with a transaction when a terminal cannot read the magnetic stripe to provide the same charge-back protection as obtaining an imprint of the card.Details
Credit card charge-offs, among “prime” asset-backed securities, headed north during September, as the 60+ day delinquency remained at a four-year low. The monthly payment rate also climbed to its highest level in two years. “Prime” charge-offs increased to 6.13% in September, compared to 6.01% in August, and 6.77% one-year ago. The 60+ day delinquency index for “Prime” portfolios remained at 2.86% for the third month, its lowest point since August 2000. FitchRatings also reported that yield and payment rate indexes moved upward during September. Fitch’s yield index rose 113 bps sequentially to 17.50%, the highest level in two years. The monthly payment rate was up 23 bps above the prior month to 17.56%. According to Fitch’s latest issue of “Credit Card Movers & Shakers,” “sub-prime” charge-offs increased to 16.24% during September, compared to 15.58% in the prior month, and 16.64% one-year ago. Late-stage delinquencies for “sub-prime” card bonds (60+days) rose to 8.72%, its highest level since May.
ABS CHARGE-OFFS HISTORICAL
Sep 03: 6.77% 16.64%
Aug 04: 6.01% 15.58%
Sep 04: 6.13% 16.24%