CO-OP Serves 38 Military/Defense CUs

The CO-OP ATM has signed FL-based Eglin FCU, bringing the total number of military and defense-affiliated credit union members to 38, covering three million members. Situated along the Florida Panhandle in Fort Walton Beach, Eglin FCU, with $800 million in assets, provides financial services to more than 100,000 military and civilian personnel from Eglin Air Force base and Hurlburt Field. CO-OP Network is wholly-owned by its credit union shareholders and provides volume discounts on products and services that include risk management as well as debit and deposit access.

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Fair Isaac Profits Rise 45% in Fourth Quarter

Fair Isaac reported fourth calendar quarter revenues of $169.3 million, a 15.4% gain over 4Q/02. Net income for the quarter was $28.8 million, up 45% over same quarter last year. The company says the growth was due to excellent execution on a number of recently adopted growth strategies. Scoring Solutions revenues were up 3.3% to $35.3 million during the quarter. Strategy Machine Solutions revenues grew 22% to $103.3 million. Earlier this month, IBM inked a deal to become a global reseller of Fair Isaac’s core analytic capabilities for financial services providers. For complete details on Fair Isaac’s latest performance as well as prior quarters visit CardData ([www.carddata.com][1]).

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

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Ingrian DataSecure Platforms Protect Card Data

DHD Media has selected Ingrian “DataSecure Platforms” to bolster protection of customers’ credit card data, whether that data is in storage, in transit, or being used by a database or application. DHD Media’s implementation of Ingrian’s solution is a clear indicator of the value that they place on meeting and exceeding industry standards for securing customer data. DHD Media is an E-media and E-commerce services infrastructure company. Ingrian Networks brings complete data privacy to the enterprise. Ingrian DataSecure Platforms ensure that sensitive information is impervious to attacks, whether data is in storage, in transit, or in use.

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Hitachi and Omron to Combine ATM Businesses

CardFlash International reported Monday that Tokyo-based Hitachi and Kyoto-based Omron have agreed to establish a joint venture in October. Under terms of the arrangement, the new company will integrate the total business of Hitachi’s “Ubiquitous Platform Group Mechatronics Systems Division,” such as ATM’s, other self-service machines and terminal systems, with the ATM and other self-service machines, modules and solutions handled by Omron’s “Social Systems, Solutions, & Services Business Company and Advanced Modules Business Company.” Hitachi and Omron initially formed an ATM joint development alliance in 2000. Both companies said the joint venture is needed to strengthen their capability to respond to the diversification and enhancement of customer needs domestically, as well as strengthening the business structure in China among other overseas growth markets.

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AmEx TRS Profits Flat Sequentially; Volume Up 15%

American Express Travel Related Services reported fourth quarter net income of $606 million, the same as the previous quarter, but up 10.2% over one-year ago. AmEx reported that marketing, promotion, rewards and cardholder services expenses for 4Q/03 increased 27%. AmEx’s U.S. gross dollar volume increased 15%, and managed card loans increased by 12.2% during the fourth quarter, compared to one-year ago. Card spending volume contributed to a 14.6% rise in discount revenue to $2.4 billion. Credit quality improved as charge-offs fell from the previous quarter and the year-ago quarter. Delinquency (30+ days) declined 10 basis points to 2.7% from the prior quarter, and remain 40 basis points below last year’s level. Charge-offs declined 80 basis points to 4.70% for the fourth quarter, compared to one-year ago. For complete details on AmEx’s fourth quarter performance as well as prior quarters visit CardData ([www.carddata.com][1]).

American Express U.S. Card Portfolio Snapshot
4Q/03 3Q/03 2Q/03 1Q/03 4Q/02 Ann Chng
Volume $72.3b 66.3b 64.6b 58.9b 62.9b +15.0%
Loans $38.5b 35.9b 36.0b 34.6b 34.3b +12.2%
Cards 36.4m 36.2m 35.7m 35.4m 35.1m +4.3%
Delinq* 2.7% 2.8% 2.7% 3.1% 3.1% -40 bps
Losses 4.7% 5.0% 5.4% 5.5% 5.5% -80 bps
Yield** 8.6% 8.9% 8.9% 9.4% 9.8% -120 bps
* 30+ days past due; ** net interest yield

Source: CardData (www.carddata.com)

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

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NEBA Signs Chicago’s MB Financial Bank

Chicago-based MB Financial Bank has joined The New England Bankcard Association for merchant acquiring and potentially, outsourcing merchant back office operations. MB Financial Bank’s plan is to begin acquiring merchant accounts beginning in the first quarter of 2004. NEBA will assist MB through all of the steps involved in setting up and maintaining the success of their merchant portfolio. NEBA provides services to financial institutions throughout the United States, Bermuda and the Cayman Islands. MB Financial Bank is a leader among Chicago area banks and has been delivering competitive personalized service for more than 90 years to privately owned, middle-market companies as well as to individuals who live in the communities where its branches are located.

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Dispenser for Contactless Payment Devices Introduced

WA-based Accelitec has rolled-out a self-service automated transponder dispenser for use in the retail marketplace. “AcceliStation” dispenses and securely authorizes contactless payment devices (key tags, fobs, and larger transponders) for immediate consumer use. The on-site kiosk allows consumers to link payment devices to credit card, debit card, bank or prepaid accounts, and provides issuing companies a secure, efficient means to manage fulfillment as well as loyalty program processes. “AcceliStation” is part of the “AcceliPay” suite of products consisting of proprietary software and hardware — self-service kiosks, authentication and point-of-sale transponder readers, processing network, network monitoring and call center support for implementing a retail contactless payment program.

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AmEx Adds Burns to the Board

American Express named Ursula Burns, SVP and president of Business Group Operations, Xerox Corporation, to its Board of Directors. Ms. Burns, 45, received a Bachelor of Science degree from Polytechnic Institute of New York in 1980, and a Master of Science degree in mechanical engineering from Columbia University in 1981. Ms. Burns began her career in 1980 at Xerox where she first held a variety of engineering positions. American Express Company is a diversified worldwide travel, financial and network services company founded in 1850.

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Shell Canada Extends Sponsorship of the AIR MILES Program

Shell Canada Limited has signed a long-term agreement with Alliance Data Systems, and its The Loyalty Group subsidiary, to continue as a sponsor in the Canadian “AIR MILES” reward program. Shell Canada is one of the top-10 clients and has been a significant, high-frequency sponsor in the “AIR MILES” program for more than 10 years. More than 60% of Canadian households actively collect “AIR MILES” reward miles at more than 100 brand-name sponsors representing over 14,000 retail and service locations across Canada.

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Small Portfolios Command Premiums Up to 26%

When it comes to negotiating premiums for smaller card portfolio sales, size does matter. However,high quality, home grown, and seasoned credit card portfolios can command premiums as high as 26%, regardless of their size. According to R.K. Hammer Investment Bankers, portfolios with less than $1 million in assets generally produce premiums between 4% and 9%. Portfolios in the $1 million to $5 million range usually get a 5% to 15% premium, while portfolios in the $5 million to $10 million bandwidth command premiums ranging from 8% to 16%. Portfolios in the $15 million to $20 million range generally pull an 11% to 26% premium. Hammer says that some premiums paid are misleading since many smaller portfolio deals include an earnings-sharing provision based on future activity, which dilutes the effective premium figure at time of sale.

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Gemplus Achieves CMM Certification in Smart Cards

Gemplus International has achieved the “Capability Maturity Model Level 2” certification, which covers both the smart cards and the “Over The Air” platforms. The “CMM”, developed at Carnegie Mellon
University’s Software Engineering Institute, is considered the industry standard for measuring the maturity of an organization’s software development processes. Gemplus has one of the strongest R&D groups in the industry with 600 smart card R&D engineers in France, Singapore, Germany and China.

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VISA, USAID, and FINCA Launch Global Micro-Finance Program

VISA International, the US Agency for International Development, and the Foundation for International Community Assistance have formed a major public-private partnership that aims to bring new
efficiency and security to microfinance clients in the developing world utilizing electronic payment products. The initiative builds upon a two-year partnership between VISA and FINCA to improve the delivery of financial
services to entrepreneurial women in developing countries. The partnership plans to pilot how VISA solutions will provide FINCA and its clients both cost- and time-saving processes, allowing FINCA to expand
its outreach to more of the world’s poor. Specifically, VISA’s electronic payment solutions will help minimize loan transaction times for both clients and microfinance providers; lower transaction costs for processing loans; provide microfinance clients more secure access to their loan capital; reduce the possibility of cash theft; expand the variety of financial service products available to FINCA’s clients; and, introduce a new market segment to participating commercial banks.

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