VISA Pitches Procurement by Cards to 23 Countries

Delegates from 23 countries attended last week’s VISA International Government Services Conference in Edinburgh, being advised of new data on the operational efficiencies attained by using VISA products for government procurement and travel, including savings totaling US$1.4 billion per year for the U.S. federal government program, and £108 million cumulative for the relatively newer U.K. government program. VISA says total capital expenditures for the UK government are projected to be over US$685 billion USD in fiscal 2002-2003. Japan spent almost US$745 billion USD last year. The US will spend more than US$2 trillion dollars in 2003. Collectively, the delegates represented governments with more than US$5 trillion in government spending.
VISA also announced new VISA government programs including several new federal, state, and local initiatives in Brazil, a new state program in Costa Rica, and the adoption of VISA cards by the U.S. Department of Homeland Security making more than 75 percent of U.S. federal government card spending on a VISA product . Additionally, VISA announced the global launch of a new “Procure-to-Pay” toolkit that enables banks and governments to analyze best management practices, set realistic goals, and maximize cost savings for government procurement .

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Citibank Launches Citi Identity Theft Solutions

Citibank launched “Citi Identity Theft Solutions” to provide personal assistance to its credit cardholders who become victims of identity theft. A key component of Citi’s free comprehensive support program is the trained team of Identity Theft Specialists who will personally provide immediate support and assistance to cardmembers who are victims of identity theft through each step of resolving fraudulent activity and restoring credit standing. Citi Cards is part of Citigroup, the preeminent global financial services company with some 200 million customer accounts in more than 100 countries, providing consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, insurance, securities brokerage, and asset management.

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NCR’s CFO to Resign Next Month

OH-based NCR said yesterday that its SVP/CFO Earl Shanks is resigning November 9th and will be replaced, on an interim basis, by VP/Finance Pete Bocian. In Pete Bocian’s current role, he is responsible for financial planning and decision support for NCR, all finance re-engineering efforts and operational accountability for the company’s shared service centers. Previously, he was CFO of NCR’s Retail and Financial Group and was responsible for the combined financial and administrative functions for the four business units comprising that group.

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PKO Bank Polski Deploys Fair Isaac’s “Netsourced TRIAD” Adaptive Control Technology

PKO Bank Polski SA has become the first financial services provider in Eastern Europe to utilize Fair Isaac’s “TRIAD” adaptive control technology. Under the multi-year agreement, Poland’s largest bank will use “Netsourced TRIAD” to measure risk and assess opportunities for more than five million current credit accounts. The bank services 4.8 million personal accounts and more than 417,000 corporate accounts. “Netsourced TRIAD” enables lenders of any size to send customer data over a secure network via the Web and returns recommended actions overnight for immediate implementation in account management and billing systems. Behavior risk models included in the system will give PKO BP an accurate assessment of its customer accounts, even where portfolio volumes are low or historical data conditions would prohibit custom model development. PKO plans to utilize “Netsourced TRIAD” to implement customer-specific strategies in the credit line management decision area, which will allow the lender to increase overdraft facility while carefully monitoring risk and debt.

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MICROS 3700 POS System to Process SVS Gift Cards

MD-based MICROS Systems and TN-based Stored Value Systems announced the integration of SVS gift cards with the “MICROS 3700” point-of-sale system. SVS processes more than 45 percent of all gift cards in the U.S. Its cash card program facilitates electronic gift, loyalty and employee payroll services for retail and restaurant merchants, both online and at the point of sale. MICROS Systems, Inc. provides enterprise applications for the hospitality industry worldwide. Over 140,000 MICROS systems are currently installed in table and quick service restaurants, hotels, motels, casinos, and leisure and entertainment operations in more than 130 countries. Stored Value Systems, Inc. (SVS) is one of the world’s leading providers of electronic gift certificate and card-based transaction programs. International retailers rely on SVS to create customer loyalty, increase sales and strengthen their competitive position in the retailer marketplace, via both traditional sales channels and on the Internet.

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SunTrust and Sterling Financial Expand Corillian Voyager

Corillian announced this week that SunTrust Bank has upgraded to the “Voyager 3.0” platform and that PA-based Sterling Financial has added small business banking into its “Voyager” solution. Corillian Small Business, which is deployed on the industry-leading Corillian Voyager 3.0 platform, allows Sterling Financial the ability to leverage feature-rich capabilities key to small business customers. Corillian also announced that SunTrust Bank has successfully upgraded to the Corillian Voyager 3.0 platform to improve online banking performance and client satisfaction. Corillian is a premier provider of enterprise software and services for the financial services industry.

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Concord Profits Decline 2% in 3Q/03

Concord EFS reported third quarter revenue of $588.5 million, an increase of 14% over 3Q/02. However, net income declined 2% to $92.6 million, compared to one year ago. Concord pointed out that it had its best quarter ever in new quick service restaurant locations, which grew a net 2,700 restaurants and represented approximately 21% of merchant location growth. The processor also noted that year-over-year growth in cost of operations, exclusive of interchange, was kept to its lowest level since first quarter 2002, and selling, general and administrative costs declined as a percentage of revenue for the third quarter in a row. Network Services revenue increased 9% to $169.2 million on transaction volume growth of 9% in the third quarter.There are approximately 132 million debit cards that display the “STAR” brand and that may be used at approximately 1,257,000 ATM and POS locations. Concord currently provides processing for 20.6 million debit cards and approximately 94,100 ATMs. Payment Services revenue was $419.3 million in the third quarter, up 17% on transaction volume growth of 23%. Payment Services revenue includes interchange fees of $268.6 million in third quarter, up 22% as compared to $220.1 million in third quarter 2002. Payment Services currently provides payment-processing services for approximately 446,000 merchant locations, including 20,300 quick service restaurant locations. For complete details on Concord’s third quarter performance visit CardData ([www.carddata.com][1]).

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

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Certegy Third Quarter Profits Rise Nearly 20%

Certegy reported net income of $26.3 million on revenues of $255.8 million for the third quarter, an increase of 19.8% and 0.5%, respectively. Card Services generated revenue of $164.0 million in the third quarter, 2.1% below 3Q/02. Certegy says strong 15.6% revenue growth in its North American card issuing operation was offset by declines in South American card issuing revenue and domestic merchant processing revenue. Card Services’ operating income of $36.6 million increased $2.0 million, or 5.7%, compared to $34.7 million in 3Q/02. Check Services generated revenue of $91.7 million in the third quarter, an increase of 5.6% over 3Q/02, driven by improved check guarantee volumes. Check Services’ operating income of $11.9 million increased by $3.7 million, or 46.1%, compared to $8.1 million in the corresponding 2002 quarter. For complete details on Certegy’s third quarter performance visit CardData ([www.carddata.com][1]).

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

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Metris Posts Record Loss of $120MM in 3Q

Metris Companies reported a record net loss of $120.3 million for the third quarter, due to the impacts from the sale of its membership club and warranty business, a portfolio sale of approximately $590 million, a workforce reduction, the sale of certificates of deposit, and an anticipated portfolio sale of approximately $500 million in the fourth quarter. The sub-prime credit card specialist is seeking to reduce its overall funding requirements going into 2004. Metris lost $15.7 million in the second quarter and $25.0 million in the first quarter of this year. Last year, Metris lost $48.5 million in the fourth quarter and $36.4 million in 2Q/02. Managed credit card loans at September 30, 2003 declined by approximately $2.4 billion to $9.0 billion during the same period. The decrease in managed portfolio balances was due to the $590 million portfolio sale during the third quarter, the sale of two portfolios of delinquent accounts totaling $69 million, continued slower account growth, tighter underwriting standards and more stringent credit line management strategies. The managed net charge-off rate for the third quarter was 23.1%, compared to 19.1% in the previous quarter, and 16.3% for the third quarter of 2002. The managed delinquency rate was 11.1% as of September 30th, compared to 11.2% as of June 30th, and 10.7% as of September 30, 2002. For complete details on Metris’ third quarter performance visit CardData ([www.carddata.com][1]).

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

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Peter Pan Gift Card Launches Next Month

TX-based Cinemark USA has become the first major motion picture exhibitor to offer gift cards for purchase over the Internet. In conjunction with the roll-out of online gift card purchasing, Cinemark and Universal Pictures have teamed up to release the Cinemark “Peter Pan Gift Card,” featuring artwork from the upcoming Universal Pictures / Columbia Pictures / Revolution Studios film “Peter Pan,” opening Christmas Day, 2003. This limited edition gift card will be available November 3rd. After a Cinemark gift card is purchased, it may be registered at Cinemark.com, allowing the gift card account to be managed, including viewing the card activity and reloading it with additional value. Cinemark USA operates 281 theatres and 3,052 screens currently in 33 states, and internationally.

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AXALTO 3Q/03

Schlumberger reported that its revenues for smart cards increased 27% to
$202 million, compared to one year ago. Last month Schlumberger changed
the name of Schlumberger Smart Cards & Terminals to Axalto. Axalto had
pretax operating income of $22 million in the third quarter compared to
$8 million in the second quarter, and $7 million one year ago. Mobile
communication card deliveries increased significantly, with three
consecutive all-time monthly volume records. The average sales price of
SIM cards increased by 14% compared with the previous quarter due to
important deliveries of very high-end 64K and 128K cards, mainly in
Italy, Brazil, Russia, Romania, Saudi Arabia and the Philippines. Other
card activities were also significant, driven by shipments for the
banking conversion to the EMV standard in the UK, strong e-purse
deliveries in Malaysia, robust pay-TV shipments in the US, and high
volumes of phone cards and scratch cards in China and Mexico.

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