New ECHO Service

Electronic Clearing House, Inc. announced that it has created a joint marketing alliance with Provident Bank to offer Consolidated Returns Services to ECHO’s customers and prospects nationwide. Consolidated Returns service is an effective method of consolidating a company’s returned checks into one bank, even if the company has multiple depository banks nationwide. This allows a company to better control their collection process by speeding the collection of returned checks through electronic re-presentment and provides significant cost savings on banking fees usually associated with NSF items.

![][1] Another major benefit of utilizing the Consolidated Returns Services is reducing the return check process to as little as 72 hours. This gets the bad check writer into ECHO’s NCIS negative database faster and eliminates the chances that any additional checks written by the same bad check writer will be approved.

“We are pleased to work with Provident Bank in offering Consolidated Returns Services. This alliance will enhance our ability to offer merchants the most comprehensive check services in the country and also continue to strengthen our NCIS database,” stated Joel M. Barry, CEO of ECHO.

About Provident Bank. The Provident Bank is the main subsidiary of Provident Financial Group, Inc. (Nasdaq:PFGI), a Cincinnati-based company with $13.9 billion in on-balance sheet assets and $19.6 billion in managed assets. The Provident Bank provides full-service retail and commercial banking operations regionally and nationally. Additional company information is available at [http://www.provident-bank.com][2].

About ECHO. Electronic Clearing House, Inc. provides debit and credit card processing, check guarantee, check verification, check conversion, check re-presentment, check collection, and inventory tracking to over 58,000 retail merchants and U-Haul dealers across the nation.

[1]: /graphic/providentbank/providentbank.gif
[2]: http://www.provident-bank.com/

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CollectionsX COO

CollectionsX, the leading online exchange for the debt collections industry, announced the addition of Gregory M. Shelton, as Chief Operating Officer. Mr. Shelton joins CollectionsX, as part of a reassignment within the CyberStarts family of companies. Mr. Shelton will provide strategic management expertise, assist with business development efforts, and oversee CollectionsX’s day to day operations.

“We are thrilled to add an individual with the stature and experience of Greg Shelton to our management team,” said Alec Smythe, CEO of CollectionsX. “Greg’s experience and knowledge of the receivables management space will greatly assist us in delivering leading debt sales and contingency placement solutions to the industry.”

Mr. Shelton has over 30 years of collections industry expertise. Prior to joining the CyberStarts family of companies, Mr. Shelton founded AMO and served as its President and CEO. In 1995, Mr. Shelton co-founded OSI, today the nation’s largest receivables management company, where he served as EVP and COO. From 1992-1995, he headed First Financial Management’s banking and retail divisions as EVP, leading the combined sales and marketing efforts. >From 1986-1992, Mr. Shelton worked with CitiBank, as VP of the U.S. Card Products Group and National Recoveries Director for Visa and MasterCard Products.

About CollectionsX

CollectionsX is the leading online B2B exchange for the debt collections industry, making it easier, faster, and more convenient for collection agencies and credit grantors to interact with each other. CollectionsX utilizes advanced, custom auction capabilities to help companies buy and sell debt portfolios more easily. The company also assists creditors in placing debt portfolios for contingency collection by leveraging proprietary information, analytics and cutting edge technology. CollectionsX is based in Atlanta and has offices in New York, Chicago and Miami. For more information, visit [http://www.CollectionsX.com][1].

About CyberStarts

CyberStarts is a technology holding company that focuses on opportunities in the financial services sector. Its mission is to invest in and operate technology companies in under-served markets with financial services; currently, CyberStarts focuses on collections, insurance, payments, and investments sectors. CyberStarts’ strategic investors and partners include Marsh & McLennan Capital, NCO Group, iXL, Guyton Partners, Wachovia Capital, and First Data.

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

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Card Response

Response rates to direct mail credit card solicitations continue to stagnate. Meanwhile, 5% of consumers now use the Internet to shop for a new credit card compared to 2% in 1999. The latest data from BAIGlobal shows the response rate to direct mail credit card offers have dropped to 0.60% compared to 1.6% in 1Q/99. The mail volume of credit card offers exceeded 3 billion between 3Q/99 and 3Q/00.

DIRECT MAIL CREDIT CARD OFFERS
PERIOD MAIL VOLUME RESPONSE RATES
3Q/00 888.0m 0.6%
2Q/00 991.8m 0.4%
1Q/00 629.4m 0.7%
4Q/99 510.2m 0.7%
3Q/99 710.3m 0.9%
3Q/98 811.3m 1.3%
3Q/97 748.1m 1.3%
3Q/96 562.8m 1.4%
3Q/95 662.7m 1.6%
3Q/94 550.0m 1.6%
3Q/93 380.5m 2.6%
3Q/92 223.9m 3.3%

m-millions Source: BAIGlobal, Inc.

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Traffic Jam

Measuring traffic to Web sites is far from an exact science . . . . infact it is closer to a rough guess. DoubleClick and comScore Networks announced Friday a new, online, audience measurement product that closely matches the server logs of individual sites. The resultant data confirms that actual traffic to most Web sites is substantially higher than has been reported by other syndicated ratings services. Furthermore, privately-owned Web sites with substantial traffic are often excluded by the syndicated ratings services. The ‘netScore’ service represents a major breakthrough in accuracy of traffic measurement, by resolving two key issues that have existed in ratings services: specifically, massive sample sizes and adequate representation of all key consumer segments: at-home, at-work, at-school and International. As an example of the degree to which site traffic has been understated by current ratings services, Media Metrix reported 51.9 million unique U.S. visitors for Yahoo during December 2000, while netScore reported 81.3 million unique U.S. visitors, a 56% difference. Yahoo self-reported 181million unique worldwide visitors for December 2000, while netScore closely matched that number by reporting 177 million unique worldwide visitors for that same time period. In contrast, Media Metrix reported 89.4million unique worldwide visitors for December 2000.

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Fincentric

Prologic Corporation, a leading global developer of web-enabled financial services software, announced today that it has changed its name to Fincentric Corporation. The new name, which is effective on March 15, 2001, represents a more accurate reflection of the company’s current market position and customer centric approach.

Prologic Corporation, formed in 1984, developed the world’s first PC-platform core retail system, which was marketed to small, North American credit unions. In 1999, Prologic expanded its focus and entered the large, global financial institution market sector with the introduction of the i-Wealthview(TM) enterprise wealth management software solution.

“We have demonstrated an enormous amount of success and market leadership in the last two years since launching i-Wealthview(TM),” commented Mike Cardiff, chief executive officer and president of Fincentric. “We now market our wealth management system to top-tier, global financial institutions in more than 30 countries. The name ‘Fincentric’ better reflects our current business and position in our industry.”

Fincentric is a leading developer of software solutions for the global financial services industry. Fincentric, formerly Prologic Corporation, has over 350 customers worldwide, including 7 of the 25 largest banks in the world.

Fincentric technology enables financial institutions to quickly deploy solutions for their converging financial service offerings, while also supporting capabilities for increasing profitability, customer acquisition and retention. Fincentric’s i-Wealthview(TM) enterprise wealth management solution features e-banking, e-brokerage and e-insurance. Through strategic alliances with Microsoft, Compaq Computer Corporation, and other international partners, Fincentric delivers complete, end-to-end, multi-channel wealth management solutions. The company recently announced a record increase in quarterly revenues of 259%. For more information, visit Fincentric’s home page at [http://www.fincentric.com][1], or call (604) 278-6470.

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

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Creditrust Raided

NCO Group, Inc. and NCO Portfolio Management, Inc. confirmed Thursday that their Baltimore collection center, where historical Creditrust documents are maintained, was the subject of a search conducted by the FBI. The search warrant related to alleged pre-bankruptcy activities of Creditrust prior to their transaction with NCO.

A representative of the Justice Department confirmed that neither NCO Group, Inc. nor NCO Portfolio Management, Inc. are in any way the subject of this investigation. The search did not cause any material disruption of activities in that office, and will have no impact on the office’s operating results.

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ECHO Stock

Electronic Clearing House, Inc. announced that its Board of Directors has authorized the company to repurchase up to 1 million shares of the corporation’s outstanding common stock for cash in open market transactions at market and as business conditions warrant. As of Dec. 31, 2000, the company had 21.8 million shares outstanding.

Joel M. Barry, ECHO’s chairman and CEO, noted that the Board approved this course of action after a review of the company’s financial position and investment alternatives. “We believe that the current valuation of our stock inadequately reflects the financial performance of our company and the performance expectation of our 2001 fiscal year and beyond,” stated Barry.

The stock repurchase is effective immediately through Sept. 15, 2001. ECHO will buy back its stock “from time to time,” depending on share price and general market conditions. ECHO’s stock price has been flat since November 2000. In May 2000, the stock rose to a 52-week high of $5.50. The 52-week low was $0.50.

About ECHO

Electronic Clearing House, Inc. provides debit and credit card processing, check guarantee, check verification, check conversion, check re-presentment, check collection, and inventory tracking to over 58,000 retail merchants and U-Haul dealers across the nation.

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FI Signs Samsung

Poised to tap Korea’s burgeoning consumer credit market as part of its global expansion, Fair, Isaac and Company, Inc. said this week it will provide a range of products and services to one of Korea’s leading credit card issuers.

Seoul-based Samsung Card Co. Ltd., a unit of the Samsung Group, will deploy a number of Fair, Isaac decision technology solutions to help establish long-term, personalized relationships with its eight million credit card customers. The technology will also help Samsung rapidly expand its customer base in this growing market.

Korea currently has about 20 million credit card holders, and this number is expected to grow rapidly as a result of government incentives, changes in consumer spending habits of Koreans and the absence of a check payment system. Along with Fair, Isaac, Samsung is betting heavily that credit card applications and usage will expand as non-cash payment methods become more commonplace.

Tom Grudnowski, Fair, Isaac’s CEO, said recently, “We are extremely pleased that Samsung has elected to use Fair, Isaac’s technology to create really meaningful relationships with its customers in Korea. We are very aware of the special needs of emerging consumer credit markets and the importance of developing loyalty and stepped-up activity with consumers who have little familiarity with credit card use.”

Hyungseok Lee, Strategic Information Team Leader at Samsung, added, “For Samsung, our success in Korea will depend largely on our ability to create appropriate services and convenience for our customers. We chose to work with Fair, Isaac because of the company’s global reputation in helping credit grantors better understand and service their customers. Fair, Isaac enables us to effectively measure many factors about our consumers right at the beginning of our relationship. That means we are better able to tailor product offers to specific needs — an ability that is core to our long-term success.”

As part of the agreement, Samsung will utilize Fair, Isaac’s StrategyWare(R) decision engine for account origination and predictive models to create precise, customer-appropriate offers when accounts are opened. StrategyWare provides risk managers with an ability to design, test and execute complex decision strategies without relying on programming support.

This new agreement extends an already successful and long-term relationship between Samsung and Fair, Isaac, which includes the use of the TRIAD(TM) adaptive control system for customer and account management, behavior scoring models and other Fair, Isaac products.

About Fair, Isaac

Fair, Isaac and Company is a global provider of customer analytics and decision technology. Widely recognized for its pioneering work in credit scoring, Fair, Isaac revolutionized the way lending decisions are made. Today the company helps clients in multiple industries increase the value of customer relationships. Fair, Isaac has made the Forbes list of the top 200 U.S. small companies eight times in the last nine years. For more information, visit [www.fairisaac.com][1], email info@fairisaac.com or call 1-800-999-2955.

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

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92% Marketshare

The top twenty-five issuers in the U.S. now make up 92% of the bank credit card market compared to 90% one year ago. Indeed the top ten issuers now account for 78% of the total industry according to CardData ([www.carddata.com][1]). Total industry outstandings at year end 2000 stood at $545.6 billion.

TOP 25 ISSUERS (as of 12/31/00)
RANK/ISSUER 4Q/00 4Q/99 CHANGE
1. Citigroup $87.7b $72.4b +21%
2. MBNA America $70.4b $58.8b +20%
3. Bank One/FUSA $67.0b $69.4b -18%
4. Discover $47.1b $38.0b +24%
5. Chase Manhattan $36.2b $33.6b + 8%
6. American Express $28.7b $23.4b +23%
7. Providian $26.7b $18.7b +43%
8. Bank of America $24.3b $20.9b +16%
9. Capital One $22.7b $15.7b +45%
10. Household $15.2b $13.3b +14%
11. Fleet Financial $14.8b $14.3b + 3%
12. Direct Merchants $ 9.3b $ 7.3b +27%
13. Wachovia $ 8.1b $ 6.6b +23%
14. Associates $ 8.0b $ 6.1b +31%
15. US Bancorp $ 6.6b $ 6.2b + 6%
16. Wells Fargo $ 4.9b $ 4.2b +17%
17. USAA FSB $ 4.6b $ 4.6b NC
18. First Natl NE $ 3.7b $ 3.2b +16%
19. People’s Bank $ 3.1b $ 3.9b -21%
20. National City $ 2.5b $ 2.1b +19%
21. Cross Country $ 2.4b $ 1.8b +33%
22. Firstar $ 2.3b $ 2.0b +15%
23. First North Amer $ 2.1b $ 2.0b + 5%
24. Columbus B&T $ 1.8b $ 1.4b +29%
25. Advanta $ 1.7b $ 1.0b +70%

Totals: $501.9b $430.9b +16%
Source: CardData ([www.carddata.com][2])

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

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Metris Chargeoffs

Metris Companies/DirectMerchants Bank reported this morning that charge-off figures for the company’s consolidated loan portfolio were 10.3% in January and 11.1% in February. In the Metris Master Trust, the charge-off figures were 12.7% in January and 13.5% in February. Metris said February’s loss figures appear to be higher than in other months based on the fact that February has only 28 days. Looking at these numbers on a normalized basis, February charge-off rates would be 12.2% in the Master Trust and 10.0% in the consolidated portfolio. In its most recent earnings release, Metris reported charge-off expectations of 10.0% to 11.0% in 2001, with rates in the high end of the range during the first half of the year, and decreasing in the second half of the year.

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Bankruptcy Reform

Following a cloture vote on Wednesday, the U.S. Senate overwhelmingly approved the bankruptcy reform bill S.420 yesterday by a vote of 83-15. Thirty-six Democrats backed the legislation which tightens the bankruptcy rules for consumers seeking Chapter 7 relief. President Bush has already indicated he will sign off on the legislation. The U.S. House passed its version of the legislation on March 1. The House approved the H.R.333 by a 306 – 108 vote which included 93 “yes” votes from Democrats. The new bankruptcy laws will require an income test and credit counseling for all individual filers. The law will also set a $125,000 cap on the amount of home equity that can be exempted from liquidation. It is expected that bankruptcy filings will soar before the law is enacted. (CF Library 3/2/01)

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Gift Card Award

Standard Register was honored this week by Intele-Card News at the seventh annual Prepaid Excellence Awards. Standard Register received the Best Packaging award for a gift card package developed for Mimi’s Cafe. The innovative package was cited for creative graphic design and functionality designed specifically for the retail food environment. Intele-Card News also honored Standard Register in 1999 for outstanding gift card packaging and in 1998 for a prepaid phone card program.

This year’s winning package design features an artist’s cartoon used by Mimi’s as part of its identity campaign. The gift card integrates with the look of the package. A die-cut within the package provides a consistent graphic theme when the card is removed from the package. The card allows buyers to customize the amount, while the unique tri-fold carrier contains “To”, “From” and “Initial Value” lines for additional customer personalization. A magnetic stripe, scanned at the time of purchase, allows Mimi’s employees to designate the card’s value.

“Our goal is to produce secure, creative packaging that helps gift cards stand out in a busy retail store,” said Beverly Humphrey, Product Support Director at Standard Register’s Imaging Services Group. “We appreciate the opportunity to partner with Mimi’s on this card program and are proud to be recognized with this prestigious industry award.”

Sponsored by Intele-Card News, the Prepaid Excellence Awards recognize the exemplary efforts of companies that conceive, design, implement and market prepaid products. Winners were recognized in 22 different categories at the Intele-Card News Expo 2001 earlier this week.

About Standard Register:

Dayton, Ohio-based Standard Register (NYSE:SR) is a nationwide leader in delivering customized document management and workflow solutions to healthcare, financial and general business markets. Serving as a strategic partner under its Less Paper Strategy(R), Standard Register helps transaction-intensive businesses reduce costs and increase revenue. Offerings range from traditional forms manufacturing to commercial and digital on-demand printing; e-documents and related desktop printing and processing solutions; plastic card imaging, packaging and distribution; Internet and paper-based billing services; and labeling solutions. Standard Register reported 2000 revenues of $1.266 billion. For more information, call 800/755-6405 or visit [www.standardregister.com][1].

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

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