SCA Snags Troutman’s

Troutman’s Emporium has selected Shoppers Charge Accounts Co. to operate its private label credit card program. Under terms of the agreement, the Mahwah, N.J.-headquartered SCA has acquired the receivables in Troutman’s portfolio and will administer all facets of the chain’s credit card program on an ongoing basis. Headquartered in Eugene, Ore., Troutman’s operates over 30 department stores in Oregon, Washington, Idaho, northern Nevada and northern California. Locations range in size from 40,000 square feet to 60,000 square feet and sell apparel, cosmetics, giftware, jewelry, accessories and other general merchandise. Troutman’s was ranked 26th nationally last June by The Nilson Report newsletter among retailers that own their store card receivables.

SCA services brick-and-mortar and catalog retailers throughout the U.S., along with their e-commerce operations. The company acquires retailers’ receivables or will develop private label credit card programs for merchants who currently don’t offer a house charge. In both situations, SCA assumes responsibility for generating customers’ billing statements; managing credit, collection, and lockbox functions; and creating customized marketing programs. Ranked among the nation’s largest private label credit card companies, SCA is a division of Hudson United Bank, a subsidiary of Hudson United Bancorp (NYSE: HU). Hudson United Bancorp is a $6.7 billion asset company with over 200 branch offices in New Jersey, Connecticut, New York, and Pennsylvania. Hudson United Bancorp’s subsidiaries offer a full array of innovative products and services to commercial and retail accounts, including imaged checking accounts, 24-hour telephone and Internet banking, loans by phone, alternative investment products, insurance products, private label credit cards programs and a wide variety of commercial loans and services including asset based loans, SBA loans, international services and cash management services. Wealth management services are also provided to individuals and businesses. Public sector products and services are provided to local and state governments, municipalities, educational institutions, civic and not-for-profit organizations.

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Payment Partners Signs Salo

Payment Partners ([http://www.paymentpartners.com][1]), a leading provider of international electronic funds transfers and payment services, announced the appointment of Randy W. Salo as the company’s Chief Technology Officer.

Salo joins Payment Partners to lead the technical development of its En’pointsm service ([http://www.en-point.com][2]), which enables businesses and individuals to easily, quickly and cost-effectively move funds across international borders.

“I’m thrilled to be joining Payment Partners at a time when an industry such as global payments is in such dire need of modernizing,” said Randy Salo, Payment Partners’ new CTO, “delivering leading-edge solutions to update age-old commerce systems is exciting and I look forward to the challenge.”

“We are delighted to have Randy Salo as our technology leader,” said Gregory J. Bjorndahl, CEO of Payment Partners, “his expertise and vision will greatly assist us in providing our time and money saving service to all clients with the need to make and receive cross-border payments.”

Salo comes to Payment Partners with over 20 years experience in engineering, project management, sales and marketing. Most recently he has been a technology planning consultant for companies including Intel (Nasdaq: INTC), LogicTree and Sensoria. And previously Salo held other executive and senior engineering management positions at Qualcomm Inc. (Nasdaq: QCOM), BrookTree/Rockwell, and Mentor Graphics (Nasdaq: MENT), as well as co-founding Wireless Knowledge, Inc.

Salo holds a BS in Computer Science from Oregon State University and is a member of ACM, EIA, and AEA. Salo also sits on the board of several privately held companies.

About Payment Partners

Payment Partners offers international electronic funds transfers and payment services to individuals, corporations, and private-label partnerships. Clients reduce the waiting period to receive funds, reduce the costs of transfers, and receive detailed reporting on-line.

En’pointSM, ([http://www.en-point.com][3]) the Company’s direct electronic funds transfer service, allows users overseas to safely and economically send funds to holders of US bank accounts for fees as low as $5. Individuals and businesses can receive payments from international senders or move funds into their USD bank and investment accounts. The En’point service provides transaction reporting unavailable through traditional wire transfers and international drafts permitting both senders and receivers to track payments on line and match this information with their internal accounting systems.

Transfers are made from any existing foreign bank account to any financial institution using a clearing network operated in concert with JP Morgan Chase and various automated clearing mechanisms around the world. Payment Partners is headquartered in Irvine, California, USA. For more information visit [http://www.paymentpartners.com][4].

[1]: http://www.paymentpartners.com/
[2]: http://www.en-point.com/
[3]: http://www.en-point.com/
[4]: http://www.paymentpartners.com/

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TJX VISA

Capital One has landed the TJX co-branded credit card contract and will begin issuing the card next month. TJX Companies formerly issued the co-branded card through CT-based People’s Bank. The card will be available in 1,400 T.J. Maxx, Marshalls, HomeGoods and A.J. Wright across the country beginning March 1st. Under the program cardholders will earn 5% rewards on TJX purchases and 1% for all other purchases. Rewards are issued to cardholders as they are earned in $10 increments. Pricing details have not been released. TJX operates 688 T.J. Maxx, 582 Marshalls, 112 HomeGoods and 45 A.J. Wright stores in the United States. (CF Library 8/22/97)

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Top Ten 2001

No matter how you slice or dice it, Capital One is the undisputed, fastest growing issuer among the nation’s top ten issuers of bank credit cards. However, Bank of America and Chase posted above average portfolio gains during 2001, while the top 3 issuers realized below average gains last year. Despite a rocky third and fourth quarter, American Express held its own against other major players, posting a slightly better than average gain in card loans, according to CardData ([www.carddata.com][1]).

ISSUER 4Q/01 RECV 4Q/00 RECV CHANGE
1. Citibank $108.9b* $103.2b* + 5.5%
2. MBNA $ 74.9b $ 70.4b + 6.4%
3. First USA $ 68.2b $ 67.0b + 1.8%
4. Discover $ 49.3b* $ 47.1b* + 4.7%
5. Chase $ 40.9b $ 36.2b +13.0%
6. Capital One $ 38.4b* $ 22.7b* +69.2%
7. Providian $ 32.9b $ 26.7b +23.2%
8. American Express $ 32.0b $ 28.7b +11.5%
9. Bank of America $ 27.2b $ 23.0b +18.3%
10. Household $ 16.1b $ 15.2b + 5.9%
TOTAL $488.8b $440.2b +11.0%

* Citibank includes data from Canada and Mexico; Capital One may include some international data; Discover data as of 11/30/01 Source: CardData ([www.carddata.com][2]) RAM Research Group’s Bankcard Barometer

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

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Providian 4Q/01

After delaying the release of its earnings report, Providian reported a net fourth quarter loss of $395 million from continuing operations, compared to an operating profit of $225 million for 4Q/00. The company also confirmed Thursday that banking regulators have accepted its new ‘Capital Plan’. Despite the restructuring, Providian posted a strong fourth quarter as it focused on the middle-market segment, largely abandoning the sub-prime market. During 4Q/01, the company added 500,000 net new accounts and added $950 million to total managed credit card loans. The managed net credit loss rate was 12.70% in the fourth quarter, compared to 8.49% one year ago. The 30+ day managed delinquency rate was 8.81% at year-end 2001, compared to 7.54% at the end of 2000. In light of the loss trends, Providian beefed up its loan loss reserve by $252 million during the fourth quarter. Total loan loss reserves now stand at $1.93 billion at year-end. Providian also noted yesterday it has requested approval from regulators to merge Providian Bank into Providian National Bank. The company also indicated the sale of its credit card business in the United Kingdom is progressing on schedule, as well as the planned disposition of its operations in Argentina. The company has designated its foreign businesses as “discontinued” and as a result added $86 million to its fourth quarter loss. Providian is still seeking a buyer for $3 billion in high-risk accounts. Providian’s 4Q/01 portfolio stats were published in last Friday’s CardFlash. For complete details on Providian’s 4Q/01 performance visit CardData ([www.carddata.com][1]). (CF Library 1/11/02; 1/18/02; 2/01/02)

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

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PayPal IPO Stopped

PayPal’s planned IPO, scheduled for yesterday, was delayed after another online payment company filed a patent infringement lawsuit. However Salomon Smith Barney, the lead underwriter, indicated last night that the IPO will be priced by next Wednesday. CertCo, a NY-based B2B e-commerce solutions provider, filed the lawsuit Feb. 4th in Delaware. PayPal, which will trade under the symbol ‘PYPL’, expects to raise about $80 million in the IPO. The company launched its payments-via-email service three years ago and has lost nearly $300 million. The company has 12.8 million clients. The PayPal service is widely used among buyers and sellers of online auction services such as eBay. PayPal members send more than $10 million per day in approximately 200,000 daily transactions. (CF Library 10/2/01; 11/16/01; 2/6/02)

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InteliData Snags Gilhooly

InteliData Technologies a leading provider of Internet-based financial services and electronic bill payment and presentment software, announced that Karen Gilhooly will join the company as Vice President and General Manager of its Card Solutions group based in Omaha, Nebraska. Gilhooly will focus on revenue generation and managing the relationship with InteliData’s strategic partner, First Data Resources, also based in Omaha.

The InteliData Card Solutions division provides online solutions for the top credit card issuers in the card industry. This set of solutions affords the credit card holder the ability to monitor accounts and pay bills online.

“We are delighted to have Karen join our management team,” said Al Dominick, President and CEO of InteliData. “We believe her strong background in this industry will help build InteliData Card Solutions’ customer base, as Card issuers look to take advantage of the significant technological enhancements we’ve continued to make in our Card Solutions product.”

Gilhooly brings with her almost 20 years of experience in the banking technology industry. She most recently served as Senior Vice President and COO of Electronic Billing Systems for Princeton eCom. During her career she has held numerous positions with Citibank and Citicorp. She was also employed by Thomas Cook Financial Services.

About InteliData

InteliData delivers EBPP products to banks, credit unions and financial institution processors. InteliData provides solutions that power financial institutions’ Internet banking, payment and presentment and online credit and bankcard transactions.

Headquartered in Reston, Virginia, USA, InteliData is publicly traded (Nasdaq: INTD) and its business partners include Spectrum EBP, ALLTEL and other industry leaders. For more information, visit the company’s web site at .

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Ruling Stay

The U.S. District Court for the Southern District of New York this week granted a stay in its ruling which ordered VISA and MasterCard to drop their exclusionary rules which prohibit members from issuing American Express or Discover cards. The stay will enable the card associations to pursue the appeals process and could run from two to three years. In October, Judge Barbara S. Jones issued a 157-page ruling which said VISA’s bylaw ‘210(e)’ and MasterCard’s ‘Competitive Programs Policy’ weaken competition and harm consumers in a number of ways. American Express said the development “was disappointing, but not surprising.” VISA said this week’s ruling “preserves the market structure of an industry” and avoids making the payment card business “subject to an academic experiment using untested remedies with unknown consequences.” MasterCard said the court recognized “the importance of maintaining the member business agreements pending appeal and the potentially irreversible consequences of imposing the Judgement.” The full text of the October court ruling is available on CardFlash Online ([www.cardflash.com][1]).

[1]: http://cardflash.com

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NextBank Closed

NextCard’s bank subsidiary, Phoenix-based NextBank, was shut-down late Thursday by the OCC and the FDIC was appointed receiver. The beleaguered issuer says it has been unable to find an acquisition partner and will now re-evaluate its business and operations strategies. On Jan 12th, NextCard notified the OCC that it was not possible to prepare and submit a ‘Capital Restoration Plan’, and said liquidation of the bank’s assets would not raise enough money to retire in-full the bank’s existing and anticipated liabilities. At year-end, NextBank had total assets of approximately $700 million and total deposits of approximately $554 million. The Internet-only bank has about 4,400 depositers holding jumbo CDs. The OCC determined that the bank was classifying some delinquent accounts sold into a securitization trust as fraud losses, although the delinquencies were actually attributable to credit quality problems. These assets were being repurchased by the bank at par, a practice that constituted sale of assets with recourse. This finding, together with significant accounting adjustments and the need for additional loan loss reserves, resulted in the bank becoming significantly undercapitalized. NextCard’s stock closed Thursday at 14 cents, a 26% decline from the previous session, and a new 52-week low. The stock traded at nearly $12.50 one year ago. NextCard has approximately $2 billion in card loans and 1.2 million accounts, according to CardData ([www.carddata.com][1]). The company has not released its 4Q/01 earnings report. (CF Library 10/31/01; 1/31/02)

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

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Idaho Tax Service

The Idaho State Tax Commission is making it easier for businesses and citizens to pay their taxes. The state of Idaho recently introduced a convenient online credit card payment option for most types of Idaho state taxes, including 2002 individual and business income taxes. Idaho’s tax center is available online at [www.accessIdaho.org][1], the state’s official website.

Idaho’s new tax payment services are easy to use, and a typical tax payment can be processed in just a few minutes. Visitors to the Tax Commission’s website ([www2.state.id.us/tax][2] or [www.accessIdaho.org][3]) only need to enter a taxpayer identification number, select the type of tax to be paid from a drop-down menu, and provide a credit card number.

More than $1.0 million in tax payments have been processed online since the service was launched in late December.

Both Visa and MasterCard payments are accepted through the tax website’s secure server. Taxpayers have the option of paying the balance due, making an extension payment or paying estimated taxes, or paying amounts owed for prior taxes. Credit cards can also be used to pay business income tax, sales tax, employer income tax withholding, and other business tax payments under $100,000. Any amount of individual income tax can be paid by credit card, and no additional fee is charged for using credit cards.

“We are delighted to offer a user-friendly tax payment solution to the citizens and businesses of Idaho,” said William Hart, financial officer for the Idaho State Tax Commission. “To my knowledge, Idaho is the only state in the nation that does not charge its constituents an additional fee to make credit card tax payments over the Internet.”

The tax payment system was developed and is maintained by Idaho Information Consortium, the subsidiary of eGovernment firm NIC (Nasdaq:EGOV) that manages accessIdaho on behalf of the state of Idaho.

The Tax Commission has also created a new credit card payment voucher (Form CCV) that allows taxpayers to fill in credit card information for processing by mail. Form CCV can be downloaded and printed from the Tax Commission’s “Forms” page of its website.

In addition to the online and voucher methods for paying Idaho taxes with credit cards, taxpayers can also make payments by calling or visiting any of the six Idaho Tax Commission offices.

About accessIdaho

accessIdaho is the state of Idaho’s homepage and official website ([www.accessIdaho.org][4]), a collaborative effort between the state of Idaho and Idaho Information Consortium. It was built and is marketed, operated, and maintained by Idaho Information Consortium, Inc., a wholly owned subsidiary of NIC.

[1]: http://www.accessidaho.org
[2]: http://www2.state.id.us/tax
[3]: http://www.accessidaho.org
[4]: http://www.accessidaho.org

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Cadre Certified

Cadre, an enterprise security solution provider, announced a strategic partnership with Visa USA. After an in-depth qualification process, Cadre has been validated as an independent 3rd party security firm to verify merchant compliance with the Visa CISP security program.

“The purpose of the security review that Cadre provides for Visa is to insure and protect Visa cardholder information from unauthorized access,” says Lou Carli, Vice President for Cadre. “Cadre helps reduce fraud, identify security issues, and measure merchant compliance levels with the Visa security program.”

Visa has created the Cardholder Information Security Program (CISP) in order to verify a merchant has correctly implemented information security controls. The correct implementation of these controls dramatically reduces unauthorized access to Visa cardholder information.

“Within the Visa security assessment process, Visa, the merchant, and independent security firms such as Cadre have major roles and responsibilities in assessing merchant compliance,” emphasizes Lou Carli. “Partnering with the Visa has helped Cadre establish itself as a security assessment expert. This enhances our portfolio of security services and reinforces our reputation as the preeminent provider of enterprise security solutions.”

Cadre is a Cincinnati-based enterprise security solutions provider specializing in the sale, installation, support, training, and assessment of network security systems. Cadre has operations in Cincinnati OH, Indianapolis IN, Louisville KY, Pittsburgh PA, and Detroit MI.

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