Gemplus Beefs Up its North American Conventional Card Sales Unit

Gemplus is ramping-up its North American conventional card business to take a life of its own, with local management, dedicated sales and technical teams, and a local manufacturing facility with high-volume production capacity. The company also announced it has named Timothy Wright as Director of North America Conventional Card Sales. Wright previously served as VP/Sales for the De La Rue Brand in the USA from 2000 to 2002. He is also a current member of the International Card Manufacturers Association Board of Directors. Gemplus’ Montgomeryville, Pennsylvania production facility is ISO 9002 and ISO 1400 certified. Gemplus products include conventional card products, which include PVC cards, “GemLucence” (translucent PVC card body), and “HoloGem” (PVC card body covered with foil to produce a holographic or mirror effect).

Details

American Express Says it Will Have a US Partner By Mid-2004

American Express said yesterday it expects to have its first U.S. bank agreements signed no later than the second half of 2004. Chairman and CEO, Kenneth Chenault, said VISA’s and MasterCard’s appeal to last week’s ruling by the appellate court is nothing more than a delaying tactic. He said he expects VISA’s and MasterCard’s efforts to be exhausted no later than mid-2004. A three-judge panel of the Second Circuit Court of Appeals affirmed the 2001 court decision on September 17th, which required VISA to drop its “bylaw ‘210(e)” and MasterCard to end its “Competitive Programs Policy.” VISA and MasterCard said they are seeking further appellate review, including requesting a hearing en banc before the Second Circuit Court of Appeals. (CF Library 10/10/01; 2/8/02; 9/19/03)

Details

SCHLUMBERGER-SEMA SALE

Schlumberger has signed an agreement to sell SchlumbergerSema, its IT business segment, for $1.5 billion and says it is considering
the divestiture or IPO of its smart cards, point-of-sale terminals, payment systems, eCity terminals, payphones, and Infodata businesses. Separately the company announced that it has changed the name of its Schlumberger Smart Cards & Terminals unit to Axalto. Schlumberger Limited announced yesterday the signing of a binding agreement with the French firm Atos Origin for the sale of the majority of SchlumbergerSema businesses. The deal includes $1.5 billion in cash and stock representing approximately 29% of the common shares outstanding of Atos Origin. Schlumberger says that the name change for its Schlumberger Smart Cards and Terminals division will bring more visibility and reinforce the company image as a leading smart card player in a rapidly evolving market. The division opted for a name that best reflects its smart card and point-of-sale terminals strategy and highlights the key contributions of smart cards in today’s digital age. Following the announcement of the sale of its IT business, Standard & Poor’s upgraded the “STARS” ranking on Schlumberger from “Hold” to “Accumulate.”

Details

Cubic Deploys Oyster Card Validators for London’s Bendy Buses

Cubic Transportation Systems Limited has received an order from the London Buses division of Transport for London to supply 600 “Universal Smart Card Validators” for its expanding fleet of bendy buses. The “Validators” will process the new “Oyster” card that was launched for public use in May. Cubic and EDS lead the TranSys consortium that developed London’s new smart card-based ticketing system. The “Universal Validator” incorporates Cubic’s advanced smart card technology and passenger safety features to quickly verify and deduct fares from passenger smart cards. The “Validator” operates on Cubic’s open architecture and utilizes its “Tri-Reader,” an integral module in Cubic-developed fare collection equipment for all transportation modes. The “Tri-Reader” can read any type of contactless smart card meeting international standards, providing operators a truly open system with flexibility, interoperability and a range of media choices. The bendy or articulated bus design consists of two vehicle sections connected by an accordion-like joint to facilitate turning. Cubic will install two “Validators” in the middle and rear entrances of the buses to supplement the validation unit already installed at the front of the bus, thus speeding passenger boarding.

Details

Modell’s Sporting Goods and MBNA Launch a MasterCard

The nation’s oldest, family-owned and operated, retailer of sporting goods, sporting apparel, menswear and brand name athletic footwear has launched a MasterCard. Modell’s Sporting Goods and MBNA have teamed to offer a MasterCard featuring “MVP” points that are automatically redeemed for Modell’s certificates. Cardholders will also receive special offers and opportunities for special privileges. Modell’s operates over 100 stores throughout New York, New Jersey, Pennsylvania, Delaware, Maryland and Virginia area. The new “Modell’s MVP MasterCard” will carry no annual fee.

Details

Schlumberger Sells IT Business, Renames Smart Card Unit

Schlumberger yesterday announced it has signed an agreement to sell SchlumbergerSema, its IT business segment, for $1.5 billion and says it is considering the divestiture or IPO of its smart cards, point-of-sale terminals, payment systems, eCity terminals, payphones, and Infodata businesses. Separately the company announced that it has changed the name of its Schlumberger Smart Cards & Terminals unit to Axalto. Schlumberger Limited announced Monday the signing of a binding agreement with the French firm Atos Origin for the sale of the majority of SchlumbergerSema businesses. The deal includes $1.5 billion in cash and stock, representing approximately 29% of the common shares outstanding of Atos Origin. Schlumberger says that the name change for its Schlumberger Smart Cards and Terminals division will bring more visibility and reinforce the company image as a leading smart card player in a rapidly evolving market. The division opted for a name that best reflects its smart card and point-of-sale terminals strategy and highlights the key contributions of smart cards in today’s digital age. Following the announcement of the sale of its IT business, Standard & Poor’s upgraded the “STARS” ranking on Schlumberger from “Hold” to “Accumulate.”

Details

Discover Card Profits Decline 11.5% in 3Q/03

Morgan Stanley reported this morning that its Credit Services division, including the “Discover Card,” posted lower net income for the third quarter compared to 3Q/02. Net income of $185 million was off 11.5% compared to one-year ago and down 4.6% compared to second quarter 2003 profits of $194 million. However, third quarter profits were up $3 million over 1Q/03 net income. Managed credit card loans at the end of the third quarter end rose 60 basis points to $49,965,000,000. The interest rate spread was unchanged at 8.91%, but the interest yield declined 92 basis points. Transaction volume rose 2% from a year ago, to $24.8 billion, driven by a 6% increase in sales. Account growth was flat, but active accounts declined more than 6% from 3Q/02. MS reports that merchant and cardholder fees were essentially unchanged at $523 million as higher merchant discount fees from increased transaction volume were offset by lower cardholder late fees. The managed credit card net charge-off rate increased to 6.90%, 83 basis points above a year ago, and 40 basis points above last quarter. The over-30-day delinquency rate was 6.05%, 33 basis points above last year but 16 basis points below last quarter. MS says sustained high levels of U.S. bankruptcy filings and unemployment along with changes in the Company’s account re-aging policy, which tightened terms under which delinquent accounts are returned to a current status, negatively affected the charge-off and delinquency rates. For complete details on Discover’s third quarter performance visit CardData (www.carddata.com).

DISCOVER CARD PORTFOLIO SNAPSHOT
3Q/02* 4Q/02* 1Q/03* 2Q/03* 3Q/03* Y/Y CHNG
Outstandings:$49.7b $51.1b $51.8b $50.9b $50.0b +0.6%
Volume: $24.3b $25.3b $26.1b $24.0b $24.8b +2.0%
Accounts: 46.2m 46.5m 46.5m 46.4m 46.3m +0.2%
Actives: 22.8m 22.6m 22.3m 21.8m 21.3m -6.6%
Chargeoffs: 6.07% 5.96% 6.17% 6.50% 6.90% +83bps
Delinquency: 5.72% 5.96% 6.33% 6.21% 6.05% +33bps
Yield: 12.86% 12.45% 11.78% 11.97% 11.94% -92bps
2Q/02 ended 5/31/02; 3Q/02 ended 8/31/02; 4Q/02 ended 11/30/02; 1Q/02 ended 2/28/03;
2Q/03 ended 5/31/03; 3Q/03 ended 8/31/03.
Source: CardData (www.carddata.com)

Details