CSC Debt Protection

Computer Sciences Corporation announced a new debt protection service that allows banks and other financial institutions to offer their own debt protection programs to their customers. The offering increases fee income for banks while eliminating their need to contract with insurers for such services.

The end-to-end CSC offering includes flexible planning, design and implementation, as well as full actuarial, administration and back-office support. The package is tailored to meet the specific needs of the financial services firm and the borrower. Because the program is available on an application services provider (ASP) basis, the client needs no hardware, software or programming resources.

Banks traditionally have offered debtors credit life and disability insurance. According to the U.S. Office of the Comptroller of the Currency, they may now also offer their own debt protection services for a fee. DPPs have been gaining steam since the 1999 passage of the Gramm-Leach-Bliley Act (GLBA), which modernized the U.S. financial services industry. The GLBA excluded debt protection products from the definition of insurance, freeing them from many regulatory restrictions.

“DPPs enable banks to offer borrowers a cushion against involuntary unemployment, disability and many other life-altering events,” said Gary Fagg with Dallas-based CreditRe, an actuarial consulting and training firm serving the financial services and credit insurance industry. “Since the GLBA, major credit card issuers have converted their credit insurance programs to debt cancellation programs. This billion-dollar industry is in the process of moving from credit insurance to debt protection. As a veteran of credit insurance processing since the early 1980s, CSC is an obvious choice to aid rapid DPP deployment.”

CSC has enhanced its systems to process debt protection for automobile loans and leases, consumer lending, first mortgages, other real estate-secured loans and credit cards. Supported functions include solicitation campaigns, applications, billing and collections, payment processing, correspondence, contract settlements and cancellations.

“Our debt protection service can be launched with very little effort and up-front expense,” said David Blanton, executive vice president of Banking Solutions for CSC’s Financial Services Group in the Americas. “By bringing this innovative ASP offering to market, CSC gives banks and other financial services firms a way to use information technology to improve their customer service and profitability.”

CSC continues to extend its comprehensive array of financial services business and technology offerings, ranging from the Hogan core banking systems to solutions for credit cards, image payment and archive, lockbox and loan administration servicing. More than 60 percent of the world’s top 50 banks count on CSC to support their strategies for revenue growth and processing efficiency.

Computer Sciences Corporation, one of the world’s leading consulting and information technology (IT) services firms, helps clients in industry and government achieve strategic and operational results through the use of technology. The company’s success is based on its culture of working collaboratively with clients to develop innovative technology strategies and solutions that address specific business challenges.

Having guided clients through every major wave of change in information technology since 1959, CSC combines the newest technologies with its capabilities in consulting, systems design and integration, IT and business process outsourcing, applications software, and Web and application hosting to meet the individual needs of global corporations and organizations. With nearly 68,000 employees in locations worldwide, CSC had revenues of $10.8 billion for the 12 months ended June 29, 2001. It is headquartered in El Segundo, Calif. For more information, visit the company’s Web site at .

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Interlink Backlash

Racetrac Petroleum, a gasoline convenience store retailer that operates stores in twelve Southeastern states, announced Monday that effective October 15 it will stop accepting Interlink debit cards. The firm is the second retailer to join the Interlink revolt over increased transaction fees set to take effect next month. Last week, Wal-Mart Stores announced it will not accept VISA’s ‘Interlink’ POS on-line debit cards in its 2,700 stores effective October 13. VISA decided in June to raise transaction fees from 20 cents to 45 cents per transaction. Racetrac will continue to accept other PIN-based debit cards, such as NYCE, Pulse, and STAR, and credit cards such as Discover, MasterCard, and VISA. Racetrac Petroleum owns more than 500 company and contract operated gasoline convenience stores under the ‘Racetrac’ and ‘Raceway’ brands with annual sales exceeding $3 billion. (CF Library 9/5/01)

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Euronet President

Euronet Worldwide, Inc., a leading provider of secure financial transaction solutions, announced that Daniel R. Henry has been appointed President of the company, in addition to his Chief Operating Officer role. Mr. Henry, who co-founded the company in 1994 with Michael Brown, has served as the company’s COO for the past five years. Brown previously held the title of President and will continue in his functions as Chairman and Chief Executive Officer.

In 1994, Mr. Henry established the Company’s first European office in Budapest, Hungary. For the next five years, Mr. Henry carried the day-to-day responsibilities of growing and managing the company’s ATM and transaction processing business across Europe. In 1999, when he returned to Euronet’s corporate office in Leawood, Kansas, the Company’s European business had expanded to eight countries, 200 employees, and had annual sales in excess of $25 million. Since his return to the U.S., Mr. Henry has been instrumental in the Company’s drive to being EBITDA positive and continues to oversee the growth of the business in EMEA (Europe, Middle East and Africa) and expansion into new markets. The Company’s EMEA region now consists of offices in ten countries: Hungary, Poland, Germany, Croatia, Czech Republic, Romania, France, Egypt, Greece, and the United Kingdom.

“Dan Henry and I have been partners in Euronet from the beginning,” said Brown. “He is one of the most dedicated, knowledgeable and capable individuals with whom I’ve had the pleasure of working. Dan has assumed increased responsibilities over the past two years, and I consider this appointment to be long overdue!” Euronet Worldwide also announced that since June 30, 2001, it had exchanged an aggregate principal face amount of DEM 34 million of its 12 3/8% senior discount notes for an aggregate of 1,157,000 shares of its common stock. The DEM 34 million exchanged includes DEM 30 million in exchanges that were previously reported as a subsequent event in Euronet Worldwide’s Form 10Q for the period ended June 30, 2001. As a result of these exchanges, Euronet’s 12 3/8% senior discount notes are reduced to a principal face amount of US $51.4 million (US $46.0 million in carrying value) as of August 31, 2001. The decrease in the company’s indebtedness since June 30, 2001, will result in an annual interest expense savings of approximately DEM 4.2 million (US $2.0 million per year).

“These exchanges are very positive,” said Brown. “They reduce our long-term debt and improve our balance sheet, and are another step towards profitability.”

About Euronet Worldwide

Euronet Worldwide is a global leader in the rapidly evolving arena of electronic financial transactions. The company provides software and service solutions to a wide array of industries from retail banking to mobile operators, enabling them to offer customers secure access to their personal financial information — any time, any place. Euronet operates transaction-processing centers on three continents, including owning and operating the largest independent ATM network in Europe. With corporate headquarters in Leawood, Kansas, USA, and European headquarters in Budapest, Hungary, Euronet Worldwide employs approximately 400 people in 15 locations. Additional information is available at the company’s web site, [www.euronetworldwide.com][1].

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

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Wal-Mart Banks

TD Bank USA FSB launched an initiative yesterday to offer banking products and services through Wal-Mart stores in the USA. The TD Bank subsidiary plans to begin offering checking and savings accounts in as many as 100 Wal-Mart stores, and anticipates expanding to other Wal-Mart locations in the U.S. as well as Internet and telephone banking. In Canada, TD operates 74 in-store branches in Wal-Mart stores, as well as providing automated banking machines and cash management services. TD already offers retail financial services to approximately two million customers in the U.S., through self-directed brokerage TD Waterhouse and its affiliate TD Waterhouse Bank. Wal-Mart currently has in-store banks in about 600 of its 2,700 stores. The first stores to offer TD Bank USA services will primarily be new Supercenters. Over time, TD Bank USA intends to expand the initiative to other Wal-Mart locations in the U.S.

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CF i-Series 4.0

CheckFree i-Solutions, the leading provider of interactive e-billing and e-statement applications and part of CheckFree Corporation announced that a unit of Williams will pilot the use of the CheckFree i-Series 4.0 software platform to deliver bills online to business customers.

Using the latest version of the i-Series software, Williams’ energy marketing and trading unit expects to improve customer satisfaction while reducing costs associated with traditional business-to-business billing.

CheckFree’s i-Series 4.0 software eliminates the need for printing and mailing itemized paper bills. CheckFree’s Business Process Rules Support can streamline customer follow-up efforts as well as increase the speed at which bill payments are remitted.

“Electronic bill presentment soon will become a customer service given in the business-to-business environment,” said Iris Bryant, director of customer relationship management for Williams’ energy services group. “Williams selected CheckFree as part of our larger initiative to provide our customers with web-enabled service options. We’re looking forward to a successful rollout and are excited about the possibilities for our customers.”

According to a November 2000 GartnerGroup survey of more than 100 U.S. non-service enterprises with annual revenues ranging from $100 million to $5 billion, business process improvements such as reduced billing costs, faster cash flow and an improved bill review, dispute and payment processes are critical to the success of large-scale organizations’ B2B initiatives. For instance, sellers expect to lower the typical cost of producing a paper bill or invoice from $5 to $1.65 by reducing labor, postage, paper and equipment expenses through implementing a B2B electronic billing and payment solution. In addition, these sellers also expect to cut in half the average fully loaded cost of manually resolving a bill or invoice dispute from $20 per live call to $10 for a bill dispute that is handled online. More than 10 percent of business bills or invoices are disputed today, according to a January 2001 Gartner report.

With i-Series 4.0, CheckFree i-Solutions delivers to billing organizations a full-scale platform and the ability to interface with Customer Relationship Management and Enterprise Resource Planning applications as well as an interface to Cognos(R)’ Online Analytical Processing application, PowerPlay, for browser-based, detailed analysis of bills and statements. CheckFree i-Series also offers industry-specific snap-on modules enabling payers to intelligently review, adjust, restate charges, approve and pay bills and invoices online. Vertical-specific modules address the needs of utilities, telcos, insurance, and financial services, including banking and brokerage bills and statements.

“As one of the first organizations to use CheckFree i-Series 4.0 for a business-to-business online billing solution, Williams will be able to more rapidly deploy these solutions in a cost-effective manner, while integrating the software with its existing back-end IT infrastructure,” said Tom Stampiglia, president of CheckFree i-Solutions.

Williams’ energy marketing and trading unit buys, sells and transports a full suite of energy commodities. The group handles approximately $250 billion in energy transactions each year. Williams offers its customers online access to view invoices, deal confirmations and market analyses, conduct volume checkouts, resolve questions, and manage account information through the secure online system.

About Williams (NYSE: WMB)

Williams, through its subsidiaries, connects businesses to energy, delivering innovative, reliable products and services. Williams’ information is available at [www.williams.com][1].

About CheckFree i-Solutions

As a software group within CheckFree Corporation, CheckFree i-Solutions is the leading provider of end-to-end business-to-consumer and business-to-business solutions for e-billing and payment and e-statement delivery. CheckFree i-Solutions offers CheckFree i-Series software for e-bill and e-statement creation, i-Processing services that include payment and distribution through more than 300 financial services sites and customer care, and i-Hosting services that accommodate self-hosting or outsourcing. With 271 billers under contract, CheckFree i-Solutions is committed to helping billers, financial services organizations and biller service providers leverage electronic bills and statements as interactive conduits to customer relationship management, marketing and customer self service applications.

About CheckFree ([www.checkfree.com][2])

CheckFree (NASDAQ: CKFR) is the leading provider of financial electronic commerce services and products. Founded in 1981 and celebrating its 20th year in e-commerce, CheckFree is comprised of three divisions: Electronic Commerce, Software, and Investment Services. CheckFree launched the first fully integrated electronic billing and payment solution in 1997. As of June 30, 2001, CheckFree’s Electronic Commerce division enabled more than 5.2 million consumers to receive and pay bills electronically. The company has multi-year contracts with 271 of the nation’s top billers to provide online billing and payment through more than 300 financial services organizations, including banks, brokerage firms, Internet portals and content sites and personal financial management (PFM) software. CheckFree Investment Services provides a broad range of investment management services to thousands of financial institutions nationwide. The division’s clients manage more than 1,150,000 portfolios totaling more than $500 billion in assets.

CheckFree’s Software division provides solutions through three operating units: CheckFree ACH Solutions, CheckFree Financial and Compliance Solutions (CFACS), and CheckFree i-Solutions. CheckFree i-Solutions is the leading provider of e-billing and e-statement software and hosting services for both business-to-consumer and business-to-business applications, with more billers as clients than all of its competitors have combined. CheckFree ACH Solutions provides software and services that are used to process more than two-thirds of the nation’s six billion Automated Clearing House payments, while CFACS provides reconciliation and compliance software and services to more than 400 organizations in the banking, brokerage, utility, retail, insurance and credit card industries, among others.

[1]: http://www.williams.com
[2]: http://www.checkfree.com

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Panasonic Gets Smart

Gemplus International announced this morning that Panasonic has signed a VAR agreement to promote smart card-ready electronics in North America, based on Gemplus’ smart card solution suite. Panasonic is incorporating Gemplus’ smart card technology into the reader products suite. Panasonic and Gemplus will develop and enhance market opportunities for smart card solutions based on joint expertise, global support and shared customer bases. Pansonic plans to deliver smart card-enabled consumer electronics within the next year. Panasonic Industrial Company is a unit of Matsushita Electric Corporation of America.

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G&D Loyalty Card

Giesecke & Devrient and Welcome Real-time have signed a technology agreement to collaborate on providing off-the-shelf EMV payment and loyalty cards for card issuers and retailers. The deal combines Welcome Real-time’s ‘eXtended Loyalty System’ within Giesecke & Devrient’s range of EMV debit and credit cards. This is the first time, Giesecke & Devrient will offer payment and loyalty functions on its cards. ‘Star Debit/Credit’, Giesecke & Devrient’s product line for debit and credit smart cards, is fully compliant with the current EMV standard and committed to all future standard enhancements. ‘StarDC V’ is the secure solution for VISA’s smart debit/credit cards and ‘StarDC M’, the secure solution for Europay’s and MasterCard’s ‘M/Chip Lite’.

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Agent Battle Ends

The battle over who will issue credit cards to Wachovia’s customers has ended. Due to the merger with First Union, MBNA will expand its agent bank relationship to include the current customers of Wachovia. As a result, Bank One/First USA will end their agent bank relationship with Wachovia and sell back to Wachovia approximately $1.3 billion of consumer credit card receivables of customers who also have a Wachovia retail banking relationship. On April 9, Bank One/First USA announced the purchase of Wachovia’s $8 billion portfolio The deal closed on July 27 with the proviso that if the merger with First Union was completed then Bank One/First USA would sell the relationship accounts along with the agent bank rights back to Wachovia. Under terms of the July agreement, Wachovia will pay Bank One a $350 million termination fee as well as reimburse Bank One for the premium paid for the repurchased receivables and conversion costs related to the repurchase. Wachovia expects to resell these receivables to MBNA. The agent bank relationship is expected to end in early October, and the repurchase transaction is expected to close sometime thereafter. Bank One still expects the primary Wachovia portfolio to add approximately $100 million after tax to its 2002 earnings, as previously announced.(CF Library 4/9/01; 7/30/01)

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Bankruptcy Fraud

An anonymous nationwide survey of bankruptcy judges, administrators, trustee, and lawyers conducted by Kessler International, found that 31% of those polled knew of flagrant abuses of bankruptcy laws in cases they have handled. More than 60% stated they knew of some abuse and only six percent stated that they thought bankruptcy laws were followed and each filing was honest. Kessler noted that according to statistics obtained from the U S Department of Justice only 188 cases of bankruptcy fraud were prosecuted in 1999. More than 400,000 cases were filed during the second calendar quarter, the highest number ever filed in one quarter. According to data released by the Administrative Office of the U.S. Courts, a total of 400,394 petitions were filed between April 1 and June 30 of this year, a 24.5% increase over the 321,729 cases filed in the same period last year. Kessler International is a forensic and investigative accounting firm based in New York City. (CF Library 8/27/01)

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Charge for the Cure

For the fourth consecutive year, American Express will raise money and awareness for the fight against breast cancer when it launches Charge for the Cure, a campaign to raise $500,000 for the Susan G. Komen Breast Cancer Foundation.

American Express will donate one cent for every purchase made on an American Express Card at participating merchants from September 1 through the end of October. Since 1998, through similar promotions, American Express already donated $1.3 million to help battle breast cancer. Donations are not tax deductible for Cardmembers.

This year, Charge for the Cure includes retailers in the “everyday spending” category, including supermarkets, drug stores, and mass merchandisers. Cardmembers can help raise money by using the Card for purchases at participating retailers nationwide and on-line at participating Web retailers. Cardmembers can visit for the list of participating merchants.

“Our continued involvement in the fight against breast cancer is one way American Express fulfills its core value of being a good corporate citizen,” said Susan Griffin, vice president, retail industries, American Express. “Charge for the Cure will not only help raise money for breast cancer research and community outreach programs, but it will also help raise awareness about this disease and the great work carried out by the Susan G. Komen Breast Cancer Foundation.”

American Express has been committed to raising awareness and making donations towards finding a cure for breast cancer. In addition to donating $1.3 million to breast cancer causes over the last three years, American Express is also a longstanding sponsor and participant in the annual Susan G. Komen Breast Cancer Foundation New York City Race for the Cure(R). The company also received the U.S. Postal Service’s first Social Awareness Award in May 1999 for its role in promoting nationwide awareness of the Breast cancer Research Semi-Postal Stamp.

“We are pleased to partner with American Express again this year and are extremely grateful for the support they have given us in the fight against breast cancer,” said Linda Kay Peterson, chairman of the board of the Komen Foundation. “The Charge for the Cure campaign enables Cardmembers — simply by using their cards for everyday purchases — to play an important role in the Komen Foundation’s mission to find a cure for breast cancer.”

About the Susan G. Komen Breast Cancer Foundation

The Susan G. Komen Breast Cancer Foundation was established in 1982 by Nancy Brinker to honor the memory of her sister, Susan G. Komen, who died from breast cancer at the age of 36. Today, the Foundation is an international organization with a network of volunteers working through local Affiliates and Komen Race for the Cure(R) events to eradicate breast cancer as a life- threatening disease by advancing research, education, screening and treatment. For breast health or breast cancer information, contact the Komen Foundation’s National Toll-Free Breast Care Helpline, 1.800.I’M AWARE(R), or visit its award-winning Website, .

About American Express

American Express Company is a diversified worldwide travel and financial services company founded in 1850. It is a leader in charge and credit cards, Travelers Cheques, travel, investment products, insurance and international and online banking. For more information on American Express, visit our website at .

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Stock Pounding

The stock market will be watched closely this morning after last week’s pounding following bad economic news. In early trading all sectors and markets were heading down. Friday’s erosion was driven by a spurt in unemployment and heightened talk of a recession. Among credit card stocks, Providian has now hit new 52-week lows after closing at $25.72 Friday. Last week, Providian lowered its earnings estimates for the year, citing a recent slowdown in customer purchase activity, softer loan demand relative to expectations, and ongoing credit tightening. The Providian news spilled over to other credit card stocks.

CARD STOCKS
Sept. 10
COMPANY CLOSE CHANGE 52wk Hi 52wk Lo
Providian $25.72 – 7.35% $67.00 $25.72
MBNA $30.02 -5.30% $40.12 $27.30
Metris $22.75 -3.60% $42.94 $19.15
Capital One $48.50 -3.46% $73.25 $45.88
Household $55.04 -3.44% $69.98 $43.88
Amer Express $34.60 -1.93% $63.00 $34.00
NextCard $ 7.99 NC $12.75 $ 4.56
Source: CardData (www.carddata.com)

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