Oberthur 2Q/02

Paris-based Oberthur Card systems reported second quarter revenues of US$118.5 million, a slight increase over 2Q/01. During 2Q/02, Oberthur partnered with Discover Financial Services on the manufacturing of the Discover “2GO Card.” The Discover 2GO Card, the first card of its kind in the credit card industry, has a unique, compact shape and is housed in a protective case that easily attaches to a key-chain, belt or money clip. Oberthur generated US$30.0 million in revenues in the Americas, a 21% decline from 2Q/01. However, card revenues in Asia/Pacific rose 54% to US$4.6 million, compared to US$3.0 million one year ago. Card sales in Europe, Middle East, and Africa rose 9% over the past year to US$84.4 million. During the second quarter Oberthur delivered 9 million smart cards worldwide. Oberthur has been reducing expenses this year, cutting its work force from 3,433 to 3,136 as of mid-year 2002. For complete details on Oberthur’s 2Q/02 results visit CardData ([www.carddata.com][1]).

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

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MegaRewards MasterCard

OH-based Charter One Financial has unleashed the “MegaRewards Business” program for its business debit cardholders. The card enhancement eables users of Charter One’s “SmartBusiness” or “Smart Business OneCard” to earn points toward free merchandise and travel benefits for every signature or non-PIN purchase they make. Under the “MegaRewards Business” program, Charter One small business checking customers will earn one point for every dollar they spend on a non-PIN MasterCard debit card transaction. Business customers can earn up to 10,000 points per month and a maximum of 100,000 per year. Points are valid for three years. Points can be redeemed for merchandise and travel on any airline. There is a $25 membership fee for the program annually that will be automatically deducted from each member’s checking account. The fee includes all enrolled cards on the same checking account. The annual fee is automatically waived for business customers who are active users of Charter One’s online bill payment program. In December 2000, the company was among the first in the nation to introduce a similar program for consumers.

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APAC 2Q/02

IL-based APAC Customer Services reported second quarter net earnings of $3.4 million and revenue of $94 million. Revenue declined since 2Q/01 related to weakness in the telecommunication sector and a reduction in services to certain lower margin clients. APAC Customer Services is a top provider of customer interaction solutions to the credit card industry. The company employs about 14,000 people and maintains 39 customer interaction centers across the nation. For complete details on APAC’s 2Q/02 results visit CardData ([www.carddata.com][1]).

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

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Coinstar Promotion

Coinstar will launch a special promotion between Aug 25 and Sept 21 in nearly 10,000 supermarkets and 250 store chains across the U.S. offering customers a chance to win groceries for a year and a Nissan Pathfinder. The sweepstakes will receive nationwide exposure via in-store advertising, a national full-page freestanding insert on August 25, and Coinstar radio ads in New York, Philadelphia, San Francisco, Boston, Washington D.C., Chicago, Dallas, Houston and Sacramento.

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CardMeter Launched

Centrodyne and U.S. Wireless Data have unveiled the new Centrodyne “CardMeter” taximeter which features a traditional Centrodyne “Silent 620” taximeter fitted with U.S. Wireless Data’s “Synapse Enabler,” which comprises special hardware and software to enable real-time authorization of credit cards. The Centrodyne CardMeter taximeters are available for all U.S. metropolitan areas and are currently in use in Dallas, Texas. U.S. Wireless Data is an established source of wireless transaction processing for the U.S. taximeter market.

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ATB & MONERIS

Edmonton-based ATB Financial has selected Moneris Solutions to be the new service provider for its merchant services. Last year, ATB Financial processed over $1 billion through merchant
services. ATB Financial’s new Merchant Payment Solutions, to be implemented over the next six months. ATB serves 240 communities through a network of 146 branches, 130 agencies, and 224 automated banking machines and electronic banking services.

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Arizona Banks to EPN

Arizona Federal Credit Union, Capitol Bancorp with 16 member banks, Grand Canyon Federal Credit Union and Honeywell Aerospace Federal Credit Union announced yesterday they will use EPN’s private-sector network to process its ACH transactions starting in September. Consumers use the ACH to receive Direct Deposit of payroll, Social Security and other government benefits. The ACH also processes Direct Payments of taxes, utilities and other recurring bills.

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OBERTHUR 2Q/02

Paris-based Oberthur Card systems reported second quarter revenues of US$118.5 million, a slight increase over 2Q/01. During 2Q/02, Oberthur partnered with Discover Financial Services on the manufacturing of the Discover “2GO Card.” The Discover 2GO Card,
the first card of its kind in the credit card industry, has a unique, compact shape and is housed in a protective case that easily attaches to a key-chain, belt or money clip. Oberthur generated US$30.0 million in revenues in the Americas, a 21% decline
from 2Q/01. However, card revenues in Asia/Pacific rose 54% to US$4.6 million, compared to US$3.0 million one year ago. Card sales in Europe, Middle East, and Africa rose 9% over the past year to US$84.4 million. During the second quarter Oberthur delivere
d 9 million smart cards worldwide. Oberthur has been reducing expenses this year, cutting its work force from 3,433 to 3,136 as of mid-year 2002.

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Card Bonds

U.S. credit card asset-backed securities market should reach roughly $70 billion in 2002, up from $66 billion in 2001. Standard & Poor’s says issuance was down slightly in the first half but 60% of the total credit card refinancings will occur in the second half of this year. Bank One tops the refinancing list for transactions expected to mature in 2002 at close to $8 billion, followed by MBNA at $5.5 billion, and Citibank at $4.8 billion. Although Standard & Poor’s Credit Card Quality Index loss rates have trended upward since the end of the third quarter of 2001, losses have started to stabilize and, on average, portfolio yield, payment rates, and excess spread remain healthy. Currently, average bankcard losses are 6.6% and may go up as high as 7.2%.

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Providian 2Q/02

Providian reported 2Q/02 net income of $153.9 million compared to net income of $232.4 million for the second quarter of 2001. Providian also announced Tuesday the closure of its Sacramento operations facility, effective immediately, and plans to close facilities in Fairfield, California and Salt Lake City, Utah by the end of this year. Approximately 300 employees will be affected by the closing of the Sacramento facility and an additional 1,000 employees will be affected at the Fairfield and Salt Lake City facilities. Since October, Providian has cut its workforce by 47% after the collapse of the sub-prime credit card market. The Company ended the second quarter with $19.6 billion in total managed credit card loans and 12.9 million accounts, down from $22.1 billion in managed credit card loans and 15.0 million accounts at the end of the first quarter 2002. During 2Q/02, Providian originated approximately 350,000 new customer accounts with a balanced distribution in the middle and prime market segments of approximately 65% and 35%, respectively. The managed net credit loss rate and the managed 30+ day delinquency rate for the second quarter of 2002 were 17.53% and 10.16%, respectively. The quarter ended with a managed charge-offs for the month of June 2002 of 17.22%, down from the managed net credit loss rate for the month of March 2002 of 17.64%. Providian says it spent $104.2 million in solicitation and advertising during the second quarter. For complete details on Providian’s 2Q/02 results visit CardData ([www.carddata.com][1]).

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

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Cardtronics Offers PayPort

Cardtronics, an ISO, has signed a distribution agreement to offer CashWork’s “PayPort,” a proprietary POS countertop terminal, to approve checks and use an existing ATM to dispense cash. Cardtronics is the largest ISO thus far to distribute the CashWorks solution, with a network of more than 7,500 ATMs from coast to coast, handling approximately 150,000 transactions per day. Using the CashWorks PayPort, Cardtronics customers can offer check-cashing services in their stores with a minimal investment.

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CITIBANK MONEY CARD

Citibank has introduced the Citibank Money Card Account to remit money from the U.S. to Mexico. The Money Card is linked to a distinct U.S. Citibank bank account featuring an ATM card for the recipient in Mexico. Account fees for the Citibank Money Card Account include a $5.00 monthly maintenance fee and a $7.95 fee for each withdrawal of funds transaction in Mexico. These fees are assessed to the U.S. account and are not deducted from the recipient’s cash withdrawal. Citibank Money Card Account holders in the U.S. may deposit or transfer funds into their U.S. account and the Money Card holder in Mexico may withdraw the funds at any of the approximately 20,000 ATMs in the country, including over 4,400 Banamex ATMs. Both Citibank and Banamex are member companies of Citigroup. The Citibank Money Card, currently in a pilot stage, is available through 26 Citibank Financial Centers in New York, Chicago and Los Angeles.

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