Semtek PDAs

San Diego-based Semtek Innovative Solutions Corporation has rolled out a three track magnetic stripe card reader/handheld computer packaged solution for the healthcare industry. The company will market both ‘HandEra 330’ and ‘TRGpro’ handheld computers, equipped with its ‘PDA Swipe’ card reader for ‘Palm Powered’ personal digital assistants. The total system price to the end user is less than $600. The ‘HandEra 330’ and ‘TRGpro’ fits into the PDA Swipe just as they do with the ‘HotSync’ cradle that enables bi-directional synchronization with the users’ desktop PCs. The card reader design allows the handheld computer to remain attached to the ‘PDA Swipe’ while performing the synchronization to the host PC in the HotSync docking cradle. When a card is swiped through the reader, data on the card is decoded and transferred to the handheld’s database.

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Scotiabank 3Q/01

Scotiabank delivered record earnings in the third quarter with net income of $554 million and diluted earnings per share of $1.04. In comparison to last year (excluding the one-time gains), both net income and diluted earnings per share rose by 12%.

Including last year’s one-time gains on the sale of the Bank’s stock transfer business and Solidbank, totaling 11 cents per share, net income increased by $6 million or 1% and diluted earnings per share were unchanged at $1.04.

For the nine-month period ended July 31, 2001, net income was $1,603 million or 16% higher than the same period a year ago, excluding the one-time gains. On the same basis, diluted earnings per share were $3.00, an increase of 41 cents, while return on equity was 17.4%, compared to 17.1%.

“Solid earnings and revenue growth continued across all business lines in the third quarter, keeping us on track to meet or exceed our performance targets for 2001,” said Peter Godsoe, Chairman and CEO. “Our broad-based revenue streams and a consistent focus on cost control have enabled us to maintain our strong earnings momentum.

“We continued to proactively manage our credit portfolios, resulting in a significant reduction in net impaired loans,” said Mr. Godsoe. “We strengthened our general provision by another $75 million this quarter. Our strong corrective action is keeping us on track to meet our credit quality targets for the end of the year.”

For complete details on Scotiabank’s latest results visit CardData ([www.carddata.com][1]).

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

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Ecount Hack

Philadelphia-based Ecount outsmarted a credit card hacker. The company confirmed that a hacker broke in and accessed Ecount accounts from a company server. However the company said the data retrieved was not credit cards numbers. Nevertheless the hacker attempted to extort funds from the company with the threat of publicly exposing the attack. Ecount says it never has nor will store credit card numbers. The company was able to block and reissue Ecount accounts without funds being used. Ecount’s products, Webcertificate.com and ecount.com, are similar to the pre-paid phone cards in that they have limited funds loaded onto the accounts.

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ATM Revenue

An informal NCR poll found that 82% of financial institutions rated “increased revenue streams at the ATM, such as third-party advertising or bank product sales” as “highly important” or “important.” Seventy-five percent rated “improved back-office processing, such as re-engineered cash and check deposit processing for ATMs,” as “highly important” or “important.” For non-financial ATM deployers, 93% rated “increased fee revenue generation through new transactions” as either “highly important” or “important.” However ‘Triple-DES’ encryption was the highest top-of-mind technical issue facing the ATM industry. Both MasterCard and VISA will require this high-security encryption standard on new ATMs in 2002 and existing ATMs by 2005. With 300,000 ATMs installed in the United States, all ATM deployers will need to make investments to activate ‘Triple-DES’ on both new and existing ATMs.

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Flooz Fleeced

As an online currency company folded this week there are reports that credit card fraud may be partially to blame for the company’s demise. Flooz.com shut down operations this week and intends to file for federal bankruptcy protection. Reportedly Flooz sold $300,000 of its online currency over the last 90 days to a group of credit card fraudsters in Russia and the Philippines. The ring of card thieves then redeemed the online currency for goods purchased at online stores that accept the ‘flooz’ money. The credit card processor handling the flooz account detected the fraud and promptly withheld daily disbursements to Flooz.com from credit card sales, and froze other accounts until the security account hit $1 million. The message on the Flooz.com homepage says: “We regret to inform you that Flooz.com, Inc. has ceased operations. The offices are closed and the company will file for bankruptcy protection. Flooz.com has been adversely affected by dramatic changes in capital markets and the general slowdown in the economy. Flooz.com had been in merger discussions with a number of companies but was unable to find a suitable partner.” The company used up about $50 million in venture funding.

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Stratus Card Funding

Skylight Corporation, a leading provider of PayCard Solutions announced that it has closed its Series B Round of venture capital financing. The $3.4 million round was led by Crossbow Ventures and includes The Walnut Group and other existing shareholders. The funds will be used for marketing and operations.

“We believe Skylight will be a dominant provider in this market in the next few years. Their understanding of the marketplace, their focus, technology, and their product mix clearly meet the needs of the corporate manager who wants to pay all employees via direct deposit, as well as those consumers who have no banking relationship due to their past credit challenges,” said Steve Warner, Chairman of Crossbow Ventures.

The Stratus Card provides a bank account to individuals whom would not qualify under their current status. The Stratus Card is a payment vehicle for employers to pay all their employees. The Stratus Card reduces check fraud, lost employee productivity on payday, and the expenses associated with issuing paychecks. It is also safer and more convenient for employees.

The market consists of an estimated 25 million individuals who are unable to qualify for a checking account. These individuals are forced out of the mainstream banking services and are required to conduct their banking transactions at fringe banking facilities such as check cashers, liquor stores etc. Also, most traditional banks are now charging to cash checks for non- customers.

“Skylight’s ATM PayCard targets those 25 Million individuals who are unbanked and have few options, other than expensive check cashers, to receive their pay. With the Stratus Card these consumers and the companies who employ them, can become a part of the traditional banking environment,” said Daniel Staton, Partner of The Walnut Group.

Skylight Corporation is a leading provider of ATM and PayCard Solutions for corporations and individuals. Skylight is located in Atlanta, Georgia. All ATM cards are issued through US Bank, N.A., the 8th largest US Bank.

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BofM 3Q/01

Bank of Montreal reported net income of $444 million, cash-based earnings per share of $0.88 and a cash-based return on equity of 17.8 per cent for its third quarter ended July 31, 2001.

“Excluding non-recurring items, cash-based earnings per share increased 24 per cent from the third quarter of last year, largely driven by higher earnings in the Investment Banking Group as well as improved results in the Personal and Commercial Client Group,” said Tony Comper, Chairman and Chief Executive Officer, Bank of Montreal. “Investment Banking Group results rose strongly, demonstrating the Group’s ability to perform well in a difficult capital market environment.

“The improved earnings in our Personal and Commercial Client Group reflected volume growth in our Canadian and U.S. network. The Private Client Group, which continues to build distribution capability that will ensure future success, shared in the industry-wide decline in client-trading volumes,” said Mr. Comper.

Third Quarter 2001 compared with Third Quarter 2000

Net income for the Investment Banking Group was $163 million in the third quarter, a $28 million or 20 per cent increase over the same period last year, reflecting improved performance in interest-rate-sensitive businesses and in client-driven trading activities.

Personal and Commercial Client Group results, excluding non-recurring items, were $13 million higher than in the third quarter of last year, as the Bank improved revenues from volume growth in Canada and the United States, while maintaining spreads. Revenue increases were partially offset by a five per cent increase in expenses from the same period last year, associated with the Group’s continued investment to support future growth.

In the third quarter, the Private Client Group remained focused on its long-term strategy – expansion of its distribution network, expansion of the U.S. wealth management business and leveraging its relationships across the full range of the Bank’s products and services. The Group’s financial performance was significantly affected by lower client-trading volumes and continuation of deteriorating market conditions and equity values. Net income in the third quarter declined to $29 million, from $44 million in the same period last year.

Third Quarter 2001 compared with Second Quarter 2001

Excluding non-recurring items, cash-based earnings per share rose ten per cent from the second quarter and cash-based return on equity increased 0.6 percentage points. Net income rose by $22 million or five per cent.

Improved results were driven by higher earnings in the Personal and Commercial Client Group and in Corporate Support, partially offset by lower net income in the Investment Banking Group and the Private Client Group.

The Personal and Commercial Client Group’s results benefited from higher revenues due to growth in product volumes and additional days in the third quarter. Volumes improved from the immediately preceding quarter, reflecting improved sales in Canada and continued growth in the United States.

Investment Banking Group results remained strong, particularly in the context of weaker capital markets, but were down from the record results posted in the second quarter. The decline was attributable to weaker client- driven trading activity in Capital Markets, lower merger and acquisition revenues from Investment Banking and lower trading revenue and commissions in the Equity Division.

Private Client Group net income declined as weaker market conditions and slower trading activities of the summer months resulted in lower trading volumes.

Reported results in the second quarter included non-recurring gains on the sales of Bancomer and retail branches, and a non-recurring increase in the general provision for credit losses.

Year-to-date Third Quarter 2001 Compared with Year-To Date Third Quarter 2000

Excluding non-recurring items, cash-based earnings per share for the nine months ended July 31, 2001 increased by eight per cent and cash-based return on equity increased by 0.1 percentage points from the comparable period last year. Net income of $1,269 million rose by two per cent.

Improved performance was driven by results from Investment Banking Group. Personal and Commercial Client Group’s results also rose, while Private Client Group’s net income declined.

Investment Banking Group benefited from improved results in Capital Markets businesses due to a more favourable interest rate environment and higher client-driven trading activity.

Revenues of Personal and Commercial Client Group increased due to higher volumes and improved spreads. Expenses increased due to higher costs of investing in initiatives and in increased front line sales staff.

Private Client Group net income declined from the prior year due to unusually strong equity capital markets last year.

The Bank indicated that due to slower economic growth in North America, excluding non-recurring items, the outlook for fiscal 2001 cash-based earnings per share growth is approximately six to eight per cent and the outlook for cash-based return on equity is approximately 16 to 17 per cent.

For complete details on Bank of Montreal’s latest quarterly results visit CardData ([www.carddata.com][1]).

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

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Beenz Been

Another online currency company went down in flames this week as its customers now hold worthless beenz. Beenz.com pulled the plug on its Website on Sunday after it became clear it could no longer raise funding. The company has raised more than $80 million in four rounds of funding. The company is now looking to liquidate assets within the next two weeks. Three months ago the CEO and president resigned and the work force trimmed. The company has offices in New York and London. The message on the Beenz.com homepage says: “No beenz earning or spending transactions will be honored after that date and time. Any beenz remaining in a Member’s account after 12:01 am (EST) on August 26, 2001 will be invalidated by beenz.com, and the Member will not be entitled to any compensation of any kind for such invalidated beenz”.

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Schlumberger on Campus

SchlumbergerSema said Tuesday that CyberMark will market, sell and support its entire range of smart card-based solutions for the college and university campus market in North America. CyberMark will begin supporting existing SchlumbergerSema smart card installations on 20 US campuses. CyberMark will market smart cards, readers, terminals and software that integrate physical ID with advanced network security, campus auxiliary services, and on- and off- campus convenience applications. Together SchlumbergerSema and CyberMark have a track record implementing 60 campus installations utilizing two million cards worldwide.

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Wachovia Management

First Union and Wachovia announced the next level of leadership for the combined company, effective after merger consummation. These 105 leaders will report to the new Wachovia Operating Committee members — the 13 direct reports to Ken Thompson and L.M. Baker Jr., who, respectively, will be chief executive officer and chairman of the new Wachovia. This team will help define and create all aspects of the new company, and will be drivers of future success for the proposed fourth largest bank holding company in the United States.

“Selecting these leaders is an important step in our merger integration efforts, and I am excited about the opportunity to begin combining our two teams,” said Baker. “We had a broad range of exceptional talent to choose from, and while the decisions were difficult, I believe we have selected the best group to move our new company forward.”

Leaders were chosen for their roles through a detailed and thorough selection process that included open self-nominations, interviews and final approval of each selection by Thompson and Baker.

“I am confident in the talent of this team and its ability to ensure the new Wachovia is a fierce competitor in financial services,” said Thompson. “This new leadership reflects the combination of two powerful teams and will make us stronger than we were before our plans to merge.”

The new leadership team is listed in order of reporting relationship to previously named Operating Committee members for the new Wachovia:

Capital Management Group – Don McMullen

Compliance – Vic Albrecht
Insurance: Annuities, Life (Mass Mkt.), Online – David deGorter
Strategic Relationship Director, Wealth Management – Anne Doss
Asset Management/Mutual Funds/ Business Management – Bill Ennis
Chief Investment Officer – Dennis Ferro
Corporate and Institutional Trust – Darryl Fluhme
Brokerage – Danny Ludeman
Women’s Financial Advisory – Debra Nichols
Chief Investment Officer, Wealth Management – Steve Reynolds
Chief Financial Officer – Emile Shahadi

Corporate and Investment Banking – Steve Cummings and Barnes Hauptfuhrer

Treasury Services – Ranjana Clark
Co-Head, Principal Investing – Ted Gardner
International – Michael Heavener
Fixed Income – Steve Kohlhagen
Equity Capital Markets – Mickey Misera
Co-Head, Principal Investing – Scott Perper
Group Operating Officer – Tom Pacer
Finance – Dave Pitelka
Client Development Administration – Amy Pitt
Leveraged Finance – Wayne Robinson
Investment Banking – Kevin Roche
Structured Products – Ben Williams
Global Corporate Banking – Doug Williams

Corporate and Community Affairs – Mac Everett

Public Policy – Greer Cawood
Community Development – Jane Henderson
Corporate Communications – Ginny Mackin
Corporate Contributions and Community Involvement – Shannon McFayden

Finance – Bob Kelly

Corporate Real Estate – Bob Bertges
Financial Regulatory Reporting – David Julian
Investor Relations – Alice Lehman
General Services and Operations – Dale Quigg
Audit – Peter Schild
Corporate Tax – Pat Shevlin
Treasury and Planning – Tom Wurtz

General Bank – Ben Jenkins

Contact Call Center – Steve Boehm
Mid-Atlantic Chief Executive Officer – Jim Cherry
Atlantic Chief Executive Officer – Reggie Davis
Florida Chief Executive Officer – Bob Helms
Community Banking – John (Bill) Holt
Customer Service Excellence – Beth McCague
Wholesale Segment – Walter McDowell
Chief Financial Officer – Bob McGee
Merger Integration – David Pope
Penn/Del Chief Executive Officer – Bob Reid
Real Estate Financial Services – Mike Slocum
Carolinas Chief Executive Officer – Will Spence
Retail Segment – Cece Sutton
Georgia Chief Executive Officer – Gary Thompson
General Bank Products – Beverly Wells

Human Resources – Paul George

Recruiting Solutions – Denny Clark
Capital Markets – Jim Esposito
Compensation and Benefits – Larry Gilmer
Wealth Management – Peggy Joines
Corporate Businesses – Hector McEachern
Information Technology, Operations and e-Commerce – Patti Royal
Capital Management – Doug Steele
Chief Financial Officer – Ben Stewart
Performance and Leadership Consulting – Jeanette Sims
HR Enterprise Services – Sharon Smart
General Bank (State Banking and Retail Financial Services) – Gwynne
Whitley

Information Technology, e-Commerce and Operations – Jean Davis

e-Commerce – Lawrence Baxter
Chief Information Officer, Shared Services – Nancy Church
Chief Information Officer, Commercial – Martin Davis
Banking and Enterprise Support Services – Jerry Enos
Chief Information Officer, Capital Markets – Bridget-Anne Hampden
Chief Financial Officer – Ginny Hartsema
e-Ventures – Don MacLeod
e-Risk – Joel McPhee
Chief Information Officer, Wealth Management and Capital Management –
Craig Miller
Chief Information Officer, Retail – Joe Monk
Operating Services – Richard Penland
Technology Services – Frank Robb
Wholesale Operations – Bob Sontag
Chief Information Officer, e-Commerce – Julian Wachs

Legal – Mark Treanor

Capital Management – Hal Clark
Litigation/Interim Risk Management – Douglas Edwards
Wealth Management – Joe Long
General Bank – Mark Metz
Capital Markets – James Powers
Corporate Services – Sterling Spainhour
Corporate and Securities – Michael Watkins

Risk Management – Don Truslow

Chief Risk Officer, Capital Markets – John Bresnan
Senior Risk Officer, Capital Markets – David Gaines
Risk Support Services – Ray Johnson
Chief Risk Officer, General Bank and Commercial – Spurgeon Mackie
Chief Risk Officer, Commercial Real Estate – Mark Midkiff
Chief Risk Officer, Consumer – David Nole
Market Risk – Fred Pennekamp
Portfolio Management Modeling/Risk Methodology – Russell Playford
Operational Risk – Yousef Valine
Chief Risk Officer, Capital and Wealth Management – TBD
Compliance Officer – TBD

Specialty Finance & Corporate Support Services – David Carroll

Specialty Finance – Bob Burton
Customer Analytics – Bob DeAngelis
Corporate Marketing – Jim Garrity
Data Management – Guenther Hartfeil
Merger Integration Project Office – Sid Tate

Wealth Management – Stan Kelly

Wealth Management Director, Florida – Anne Alexander
Wealth Management Director, Atlantic (NY/NJ/CT) – Linda Bowden
Wealth Management Director, Penn/Del – Curt Farmer
Chief Operating Officer – Bob Kniejski
Chief Financial Officer – Glenn McCoy
Wealth Management Director, Carolinas – Bob Newell
Ultra-High Net Worth – Dan Prickett
Wealth Management Director, Virginia – Michael Roberts
Wealth Management Director, Metro-Washington, D.C. – Deborah Shore
Wealth Management Director, Georgia – Isaiah Tidwell

First Union (NYSE: FTU), with $246 billion in assets and stockholders’ equity of $16 billion at June 30, 2001, is a leading provider of financial services to 15 million retail and corporate customers throughout the East Coast and the nation. The company operates full-service banking offices in 11 East Coast states and Washington, D.C., and full-service brokerage offices in 47 states. Online banking products and services can be accessed through.

Wachovia (NYSE: WB) is a major interstate financial holding company offering banking and financial services to individuals primarily in Florida, Georgia, North Carolina, South Carolina and Virginia and to corporations and institutions throughout the United States and globally. Wachovia Corporation is headquartered in Atlanta and Winston-Salem, N.C., and had assets of $74.8 billion at June 30, 2001. Wachovia’s Web site is located at .

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VISA Upgrade

VISA said this morning it has successfully deployed the ‘BankCard Clearing Consolidation’ initiative, the largest-ever change to VisaNet’s 25-year-old clearing and settlement system. The new ‘VisaNet’ clearing system replaces complex and intertwining Assembler code applications with a modular set of applications and tables that will allow ongoing enhancements to be designed, tested, and deployed much more quickly. Financial institutions also benefit from synchronization of clearing cutoff times and dates for the two different types of transaction messages used today, as well as extension of ‘VisaNet’s BASE II’ settlement processing to seven days from its previous six days a week. The deployment involved more than 750,000 lines of code, nearly 5,000 elements, 8,000 tables, and 2,800 person-months of work. The new clearing architecture came on line on July 15 at four data centers on three continents, and in its first two days processed 109 million transactions valued at US$3.5 billion.

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Junum & ITS

Junum Inc.,, a Delaware corporation specializing in credit management, debt exchange and financial services announced it has signed a marketing agreement with Internet Transaction Services .

The agreement calls for ITS to market the Junum.com products through its marketing distribution channels, which include multiple telemarketing centers, direct mail, infomercials and retail distribution around the United States. Targeted markets include more than 200 million individuals and businesses that have been identified as candidates for the Junum services.

Specifics of the agreement were not released.

“We are very pleased that ITS is bringing their distribution and their experience in marketing credit-related products to the Junum family of services,” said Shawn Coughlin, Junum’s director of marketing.

About Internet Transaction Services

ITS specializes in direct to consumer sales and marketing of credit-related products and services. Sales and marketing includes direct mail, telemarketing, Infomercials and retail products. ITS is based in Longmont, Colo.

“ITS looks forward to marketing the Junum services to such a vast market where the Junum Credit Management service should be in great demand,” said Max Lucas, managing director of operations at ITS.

About Junum

Junum is a publicly traded financial services holding company with subsidiaries that are using technology to capture the credit management, debt exchange and financial products markets. Its four subsidiaries include Junum.com, Voleran, Junum Financial, and Junum Intellectual Property Holding Co.

Junum.com provides complete credit management, which works to improve the credit rating and protect the credit identity of individuals and small business through online credit analysis, enhancement and protection.

Voleran’s Debt Exchange program reconstitutes non-performing debt portfolios into new performing receivables in the form of a Voleran credit card bundled with membership in the junum.com complete credit management program. Junum Financial enables lending partners to market to customers that meet predetermined criteria as identified by Junum.

Junum Intellectual Property Holding Co. retains financial technology products developed or acquired under the Junum family of companies. Junum is dedicated to developing technologies and acquired assets to create shareholder value.

More information is available through Junum and its Web site: .

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