BofA and National Processing Deal Done

Bank of America closed its $1.4 billion acquisition of National Processing. As the No. 1 check processor, and debit card issuer and the No. 4 credit card issuer in the United States, Bank of America feels that the acquisition will enable them to innovate and create efficiencies in electronic payments. B of A is the No. 1 Small Business Administration lender in the U.S. It serves clients in 150 countries and has connections with 96 percent of the U.S. Fortune 500 companies and 82 percent of the Global Fortune 500. National Processing, Inc. provides merchant credit and debit card processing through its wholly owned operating subsidiary, National Processing Company, LLC, which supports more than 700,000 merchant locations and represents one out of every six MasterCard(R) and VISA(R) transactions processed nationwide. National City Corporation’s core businesses include commercial and retail banking, consumer finance, asset management, and mortgage origination and servicing. It is one of the nation’s largest financial holding companies.

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Citi’s International Card Profits Rise 21%

Citigroup reported that its international cards business produced third quarter net income of $200 million, an increase of 21% over the year-ago quarter. During the quarter the issuer added 100,000 net accounts to its customer base, outside North America, ending the quarter with 20.8 million accounts. Charge volume for international credit cards was up 31%, to $13.5 billion for the third quarter. Total outstandings for international cards were $15.1 billion as of September 30th, an 18% gain over one year ago. However, outstandings are down from the second quarter’s $15.7 billion. In Japan, average credit card loans were flat sequentially, but up 9% over year ago figures. In the rest of Asia, credit card loans grew 30% to $8.6 billion. Citigroup holds $5.4 billion in card loans for the EMEA region and $500 million in Latin America, which grew 17% and 25%, respectively. Charge-offs increased during the third quarter as delinquency remained flat for international cards, compared to the previous quarter. Delinquency (90+ days) remained at 1.55% for 3Q/04. Charge-offs increased from 4.24% in 2Q/04 to 5.08% for the third quarter. For complete detail’s on Citigroup’s international cards performance visit CardData ([www.carddata.com][1]).

[1]: http://www.carddata.com

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CIBC Foreign Exchange Settlement Approved

CIBC has received court approval of a settlement of a class action brought on behalf of CIBC VISA cardholders in Canada over foreign exchange transactions. The card issuer began publishing notices in 28 newspapers over the weekend, according to CardFlash International. Under terms of the settlement, announced in late August, CIBC VISA cardholders will be getting up to a C$14 credit by year end. CIBC agreed to a settlement of C$16.5 million, plus C$3 million to plaintiffs’ counsel, and to pay the costs of notification, administration, and distribution of the settlement funds. Up to C$13.85 million will be paid directly to cardholders in December as credits ranging from C$.72 to C$14.32. The plaintiffs, represented by Paul Pape and Harvey Strosberg, had alleged that the conversion of transactions from a foreign currency resulted in an undisclosed or inadequately disclosed mark up. This mark up was added to the VISA International wholesale conversion rate to obtain the Canadian dollar equivalent for foreign transactions. Similar lawsuits are pending in the USA.

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Paymentech Adds 23,500 Gas Stations

Dallas-based Paymentech has added more than 23,500 petroleum locations to its customer base this year, the largest petroleum market gain in the last decade for the Company. Paymentech’s petroleum-specific payment solutions such as Partial Debit Authorization, enables consumers to pay at the pump using debit cards, even if they are low on cash and do not meet the authorization requirement. The solutions have contributed to many contract wins and have saved merchants numerous sales. Paymentech, L.P. processes the most payment transactions in North America along with over half of all Internet transactions for retailers who accept U.S. and international payments through the traditional point of sale, Internet, catalog, and recurring payments. Along with its Canadian affiliate, Paymentech processed 7B transactions and $162B in sales volume.

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NetBank Payment Systems Targets C-Stores

NetBank Payment Systems has introduced a comprehensive package of transaction processing services and equipment designed for convenience store retailers and other merchants. Services include multifunction ATMs, ATM processing, prepaid wireless recharges, government and payroll check cashing, Western Union(R) money transfers, POSA prepaid services, prepaid wireless, prepaid long distance phone cards, prepaid debit & MasterCard cards, gift & loyalty cards, check acceptance & payment processing, credit and debit processing, electronic check conversion, recurring automated clearing house (ACH) debit, and Age verification. NetBank, Inc. operates with a revolutionary business model through a diverse group of complementary financial services businesses, leveraging technology for a better delivery of services.

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STAR Network Signs First Citizens Bank

First Data’s “STAR Network” has completed an agreement with NC-based First Citizens Bank to participate in STAR’s direct check debit and verification service. “STAR CHEK Direct” will be used to reduce check fraud losses and processing costs, generate income, and ease the check processing administration. It is the only service that offers real-time, standalone direct verification of funds availability via the consumer’s DDA account, as well as real-time check debit. STAR CHEK Direct is available for both retail POS transactions and telephone and Internet bill payments. Over 10 financial institutions, bill payment processors, and check acceptance companies have utilized the service since its introduction earlier this year. First Data serves roughly 3.5 million merchant locations, 1,400 card issuers, and millions of consumers, making the purchase of goods and services using any form of payment fast, easy, and secure. First Citizens operates 335 branches in 200 cities and towns along the east coast. It has $12.8 billion in assets.

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Fiserv Acquires CheckAGAIN

WI-based Fiserv has acquired CheckAGAIN, a provider of electronic check re-presentment services. The acquisition will contribute an estimated $15 million in annualized revenues. CheckAGAIN will enable Fiserv to expand its services into a fast-growing, complementary market as well as cross-sell a valuable service to its financial institution clients. CheckAGAIN uses automated clearinghouse transactions to re-present returned checks. It has developed a proprietary system for recovering checks that were returned due to insufficient funds. Services provided by CheckAGAIN enables businesses to reduce costs associated with check collection. CheckAGAIN has also reduced problems associated with resolving misunderstandings concerning returned checks, which greatly benefits consumers. Fiserv, Inc. serves over 15,000 clients worldwide, providing information management systems and services. The company reported $2.7 billion in processing and services revenues for 2003.

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Merrill Lynch Card Offers a Major Make-Over

VISA and Merrill Lynch have teamed to launch a special promotion offering a lifestyle make-over worth $1 million. The “Merrill Lynch Million Dollar Make-Over” offers one grand prize that includes a personal make-over, designer wardrobe, home interior make-over, 2005 Porsche “Boxster S,” 25 hours of private jet time, cooking classes with Jacques Pepin, a dream family vacation in Tuscany, and $250,000 in cash. “MERRILL+ VISA” and “Merrill Lynch VISA Signature Rewards” cardholders will automatically be entered into the sweepstakes through December 31st each time they use the card. MBNA and Merrill Lynch launched their co-branded credit cards in April. (CF Library 4/27/04)

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VISA Tops $200B in Global Comm Card GDV

VISA International reported that dollar value of all purchases and cash withdrawals made with “VISA Commercial” payment solutions hit $200 billion for the four quarters ending June 30th. The figure was up 26% over the same period last year. VISA says it took 10 years for VISA to reach the $100 billion milestone and just three years to achieve $200 billion in annual commercial volume. VISA’s nine commercial products posted volume of $177.5 billion in 2003, an increase of 19% over the year-ago period. In the U.S., VISA reported that commercial cards produced a second quarter sales volume of $28.2 billion, a 23.9% increase year-on-year. As of June 30th, VISA had 22 million commercial cards in the USA. (CF Library 4/6/04; 8/6/04)

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