Equifax 2Q/00

Equifax reported Thursday that its Payment Services unit, comprising the operations of Card Solutions and Check Solutions worldwide, increased revenue 17.8% to $192.7 million in the second quarter 2000 versus second quarter 1999. The revenue increase for Payment Services was driven primarily by merchant and card processing in U.S. Card Solutions, the new card processing operations in the United Kingdom, and Brazilian card operations. Check Solutions was also a significant contributor with a revenue increase of 11.5%. Card services in Brazil achieved revenue growth of 15.9% in U.S. dollars despite a 5% decline in the average currency exchange rate during the quarter. During the second quarter Payment Services announced a five-year card processing contract worth over $100 million with National Australia Bank. For complete details on Equifax’s second quarter visit CardData ([www.carddata.com][1]).

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


Secured Canadian Card

Home Capital Group Inc. today reported record second quarter and half-yearly earnings for the period ended June 30, 2000. These results were achieved through the Company’s wholly owned subsidiary, Home Trust Company.

Three Months Ended % Six Months Ended %
June 30 change June 30 change

2000 1999 2000 1999

Income $2,485,178 $1,958,393 26.9% $4,806,990 $3,844,523 25.0%
(basic) $0.17 $0.13 30.8% $0.33 $0.26 26.9%
Return on
equity 22.9% 21.7% 22.6% 21.8%
Revenue $16,824,847 $12,509,508 34.5% $32,529,047 $24,452,824 33.0%
Assets $791,613,273 $604,213,038 31.0% $791,613,273 $604,213,038 31.0%
Total No.
ding 14,749,695 14,811,195 14,749,695 14,811,195

– This represents the 20th consecutive quarter in which earnings
before unusual items exceeded those of the previous quarter.

– The Company recently announced a 33% increase in the dividend,
to $0.08 per share.

– The Hon. William G. Davis, P.C., C.C., Q.C., has been elected
Chairman of the wholly-owned subsidiary, Home Trust Company.

– Home Trust Company has joined the VISA Canada Association,
becoming only the 11th General Member financial institution
authorized to offer VISA cards in Canada.

– Home Trust Company will launch a secured VISA credit card
starting September, 2000 to assist consumers in establishing
or re-establishing their credit worthiness.

– The Company is on track to meet or exceed its stated goals
for the current year.

Home Capital Group Inc.
To Our Shareholders

Home Capital Group Inc. is pleased to announce record 2nd quarter earnings of $0.17 per share, or $2,485,178, versus earnings of $0.13 per share, or $1,958,393, for the comparable period in the previous year, an increase of 26.9%. Total assets grew from $604,213,038 to $791,613,273, or 31.0% and our annualized return on equity was 22.9%, compared to 21.7% on a year over year basis. Our results reflect the power of our strategy to pursue market leadership with customers who are underserved by traditional lenders.

This represents the 20th consecutive quarter, a full five years, in which earnings before unusual items exceeded those of the previous quarter.

For the first six months of the year the Company reported net income of $4,806,990, an increase of 25.0% over the $3,844,523 recorded through the first half of 1999. Earnings per share rose from $0.26 to $0.33 and annualized return on shareholders equity stood at 22.6% compared to 21.8% for the same period in 1999.

In addition, our credit quality remains excellent. Mortgage charge-offs continue to decline and our non-performing loans represented 0.36% at June 30, compared to 0.30% one year ago. In keeping with the safety and soundness with which the Company has operated, we have moved our general reserve to 0.78% of assets on a risk-weighted basis as of June 30, 2000, which is slightly higher than the average of the general reserves for the five leading banks in Canada. All other performance indicators also reflected positive results during the period under review. In short, we are on track to report a record year.

These and other achievements are the signs of a stable and profitable core business and a Company that is “coming of age.” Your Board of Directors further validated this fact by announcing a 33% increase in the dividend paid on the outstanding convertible Class A shares and Class B subordinated voting shares. This step, equating to an effective increase from $0.06 to $0.08 per share on an annualized basis, reflects our strong cash flow from operations, our financial strength, and the quality of our balance sheet. It also represents further tangible indication of our commitment to the creation of value for all our shareholders. The first quarterly dividend at the increased amount will be payable on August 10, 2000 to shareholders of record at the close of business on July 13, 2000.

I am pleased to report that the transition of Home Savings & Loan Corporation into Home Trust Company proceeded smoothly during the second quarter. Other significant steps will ensure that we are well positioned to grow and to profit from this change in the years ahead.

The Honourable William Davis, P.C., C.C., Q.C., who is already a Director of Home Capital Group, has kindly agreed to serve as Chairman of Home Trust Company. His experience, particularly with broadly based and accomplished financial institutions, and wise counsel will be of great assistance to your Company.

During the second quarter we also announced that Home Trust Company had been approved for membership in the VISA Canada Association. We are only the eleventh General Member financial institution authorized to offer VISA payment cards in Canada.

We also announced that Home Trust Company will launch a secured VISA credit card starting in September of this year. This card is designed to assist consumers to establish or re-establish their credit worthiness. These customer segments have been served effectively and profitably in the United States by several issuers. We believe that we can serve this niche in a manner that is socially responsible for consumers, and low risk yet profitable for your Company.

The economic outlook for Canada and your Company remains positive. Our core business continues to grow in an innovative and dynamic way and we are confident about the market acceptance of our new secured VISA credit card. This combination of factors makes your Company very optimistic about its future prospects.



CT-based People’s Bank reported an earnings decline for the second quarter primarily due to continued pressure in its U.S. credit card business. People’s said it is taking steps to improve the profitability of its card business, including additional repricings. The repricings will reflect the substantial increase in market interest rates. People’s also plans to reprice a portion of its portfolio based on risk characteristics. People’s expects the managed credit card yield to increase by more than 125 basis points by 4Q00. However the card issuer noted that even though the current yield on its card portfolio has lagged the movement in market interest rates and higher charge-offs, credit card services operated at breakeven levels for the first half of this year. People’s also noted that its U.K. credit card operation continues to post strong results as receivables grew by $132 million or 50% in the second quarter. For complete current and historical data on People’s Bank credit card portfolio visit CardData (www.carddata.com).

People’s Bank Card Portfolio Snapshot
2Q/00 1Q/00 4Q/00
Receivables $3.7b $4.0b $4.2b
Chargeoffs 5.18% 4.51% 4.24%
Delinquency 3.20% 3.04% 2.84%

Source: CardData (www.carddata.com)



ICICI Limited of India launched Payseal, a payment gateway, which ensures safety and security of online transactions. Payseal interfaces between the Internet shopper, web merchant and banking systems in a secured environment to facilitate online payments.

With the launch of Payseal, online shoppers can transact safely on the Internet by using their credit cards. ICICI has already signed up with over 15 leading web merchants, where all online transactions will soon take place on the Payseal gateway. In the coming months, the gateway will be available on more than 50 sites.

Payseal is already operational on magiccart.com, and is in the process of online testing with the other sites. Six other sites would be operational within the next 10 days.

In an online transaction, when transaction information travels over the Internet, it remains vulnerable to unauthorized access. Further, the consumer may not be comfortable leaving his credit card details with a net merchant especially as the transaction cannot be validated by the customer’s signature. In this environment, the consumer needs the assurance that his credit card details cannot be misused.

With Payseal, an online shopper will be able to give his card details and payment instructions directly to payment gateway in a secure session. Payseal removes any human interface both at the point of a customer’s transaction with the web merchant and subsequently during the settlement of the transaction with banking systems. This has been achieved by using the SSL (Secure Socket Layer) technology, which helps encrypt transaction data using 280 bit RSA and 128 bit encryption.

The Payment Gateway servers are hosted at ICICI’s state of the art data center, secured by sophisticated firewalls and other network security infrastructure. The gateway would employ both software and hardware encryption to ensure the highest level of security.

Payseal routes the encrypted transaction data directly for online authorization, authenticates the parties involved in the transaction and ensures integrity and privacy of all messages. By addressing the critical aspect of security in on-line transactions, ICICI believes that many more merchants, consumers and businesses will be encouraged to transact freely and securely on the Internet.

The gateway has been implemented by Compaq India for the server technologies and QSI Payment Technologies (QSI), Australia for the software solutions. QSI is a leading e-commerce payment solution provider with several successful installations across the globe.

The gateway will initially accept credit card payments with ICICI Bank as the acquiring bank. Soon, Payseal will also be able to handle a variety of other payment modes such as debit & smart cards and direct bank debits. The gateway also proposes to tie up with other banks to enable B2B payments.


Antonini Globeset CEO

Globeset, the leading global supplier of secure ePayments infrastructure services and products, announced it has named Jack M. Antonini as chairman and chief executive officer.

“Globeset has experienced dramatic growth and changes over the last couple of years,” said William Archibald, Globeset’s chief technology officer and founder. “We have grown from a single product, single channel company to a company with multiple service and product lines sold through multiple channels around the world.”

“Today’s announcement culminates a thorough search for a new leader to take us to the next level, and Jack has exactly the right combination of background, skills and management style to lead us there,” said Virginia Gambale, the director of Globeset who headed the board’s recruiting efforts. She serves as the managing director and group head of Deutsche Bank Strategic Ventures and is the former chief information officer of BT Alex. Brown.

Antonini worked previously at First Union Corporation, a $250 billion financial services company, where he served as executive vice president responsible for Internet development as well as its Consumer Banking Group. >From 1995 to 1997, he served as vice chairman and chief financial officer of First USA, one of the largest credit card companies in the United States. He also held various senior executive positions at USAA over an 11-year period, pioneering the concept of a nationwide, efficient, branchless bank. He was promoted to vice chairman, president and chief executive officer of the USAA Federal Savings Bank in 1991, responsible for all aspects of USAA’s banking business which was recognized by Money magazine in 1995 as the “Best Bank in America.”

“Jack’s large-company experience in the financial services arena and in leading public companies will be a great asset to us as we continue our path of rapid growth and solution development,” said Archibald.

Antonini adds, “I am thrilled to join Globeset which is poised for incredible growth as we work together to steer the future of payments via the Internet. I believe we have all the right tools to make a significant impact in this global space.”

“I have great confidence in Jack’s abilities, because of the results I’ve seen him accomplish at First Union and USAA,” said Jerry Peterson, a director of Globeset and retired vice president of Compaq. “Jack can help Globeset make the transition from a startup to the dominant global provider of ePayment infrastructure services and products.”

Another Globeset director, Anne Busquet, president, Interactive and Information Services, American Express, echoed his comments, saying, “The board believes we have the right combination of services, products, management and vision to build upon the company’s history of success.”

Antonini received a bachelor’s degree in business and accounting with high distinction from Ferris State University in northern Michigan in 1974 and earned his CPA in 1977.

Michael Cation, former chairman and chief executive officer, will continue with Globeset as an adviser.

About Globeset

Globeset is the leading global supplier of secure ePayments infrastructure services and products for buyers, sellers and financial-service providers. Globeset’s ePayments infrastructure provides a globally consistent and secure connection — anytime, anywhere — among financial-service providers, electronic exchanges, buyers and sellers. This infrastructure simplifies process flows and reduces costs associated with ePayments.

Globeset delivers services and products directly and through resellers and system integration partners that supply financial-service providers, corporations and electronic marketplaces. Partners and customers are supported with application hosting services, consulting, education, customization, maintenance and support. The company’s products and services include personal and enterprise commerce agents, banking applications and corporate applications, such as industry-leading enterprise reconciliation and research solution software. For more information, visit the company’s Web site at: .



Providian’s net income for the second quarter dropped to $63 million compared to $127 million for 2Q/99. The decline was largely due to a $273 million legal settlement over its past credit card practices. Nevertheless Providian’s total managed credit card loans increased by $1.8 billion during 2Q/00 due to its customer upgrading initiatives. Providian added 850,000 net new accounts during the second quarter to bring total customer accounts, which includes non-card loans, to 13.9 million. Providian says its E-commerce and UK credit card divisions posted strong gains. Also new card programs such as ‘Gold Premier’, Providian’s account upgrade vehicle, significantly drove the growth in accounts and receivables for the second half of the year. Providian’s E-commerce division includes Aria, GetSmart, and WebCard. For complete current and historical data on Providian’s credit card portfolio visit CardData (www.carddata.com).

Providian’s Bank Card Portfolio Snapshot
2Q/00 1Q/00 4Q/00
Receivables $21.8b $20.1b $19.0b
Chargeoffs 7.42% 7.18% 6.78%
Delinquency 6.48% 5.72% 5.66%

Source: CardData (www.carddata.com)


Japan’s I-Credit Bureau

Japan’s Fujitsu FIP Corp. and Fair, Isaac announced this week they have agreed to launch Japan’s first web-based credit decisioning service. The new service will target the country’s 800+ banks and other credit grantors. In the partnership, Fair, Isaac will provide its ‘Decision System’ software and scoring models to deliver the decisioning within a new Web-based solution providing businesses in Japan with instant credit decision support. The Fair, Isaac components of the joint service will be marketed under Fair, Isaac’s ‘LiquidCredit’ brand and implemented into Fujitsu FIP’s application service provider server. Fujitsu FIP clients will have access to the service via the Internet to receive support in making decisions for credit card, retail card or installment loan portfolios. Fair Isaac says its plans to process over a million consumer applications in Japan over the next three years.


TSA 2Q/00

Transaction Systems Architects reported yesterday it is beginning to see a return in spending in the banking sector, driven in part by continued growth in e-payment transaction volumes. TSA says it signed two dozen capacity upgrades with existing customers and added 11 significant new name customers during the quarter ending June 30. TSA also notes that its investment in smart card technology, including the acquisition of the ‘Chipper’ business during the quarter, is beginning to pay off. TSA signed nine smart card-related deals, including four ‘EMV FastStart’ deals in Europe and a significant win in the U.S. at Bank of America. Total quarterly revenue of $78.9 million included $46.5 million of software license fees, of which $14.3 million were recurring monthly fees. Non-recurring license fees consisted of $11.2 million of guaranteed term license fees and $21.0 million of paid upfront license fees. For complete details on TSA’s second quarter visit CardData ([www.carddata.com][1]).

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


Cheaper Than Cable

The majority of bank customers say they pay $3.00 or less each month for all banking services according to a survey released today by the American Bankers Association. Approximately 1,000 consumers were asked to estimate how much they spend on fees for banking services at their institution each month, such as fees for checking account maintenance and ATM use. Nearly half reported that they pay no fees at all. The ABA says that even at $3.00 a month, the typical bank customer would pay less than $40 per year, substantially less than the going rate for basic cable service. The survey was conducted by telephone on June 16-18 by Angus Reid Group.


Aspire CPO

CompuCredit Corporation announced that it has named Mark Lawrence to the newly created position of Chief Privacy Officer. This position will be responsible for overseeing corporate-wide compliance with policies and procedures governing the security, confidentiality and quality of consumer information, as well as reviewing and updating operations and business practices to champion the cause of consumer privacy within the company. In addition, Mr. Lawrence will ensure that CompuCredit’s privacy policies and practices continue to be fully compliant with all federal and state regulations pertaining to the protection of our consumers’ personal information. Mr. Lawrence joined CompuCredit as Director of Information Technology, in March 1999, bringing over 15 years of experience in information technology in both the private and public sectors. Immediately prior to joining CompuCredit, he was Director of I.T. Operations for The Grizzard Agency, an Atlanta-based direct marketing firm. From 1995 to 1997, he was a Principal Consultant at XLConnect, an information technology services company. This position marked his return to the private sector after serving in various technical and management positions with the Federal Aviation Administration and U.S. Air Force beginning in 1985. From 1981 to 1985, he worked for General Electric Medical Systems as a Service Engineer. Mr. Lawrence received his Bachelor of Science in Agricultural Engineering from the University of Georgia where he also served as a Staff Instructor during post-graduate studies.

![][1] Lawrence said that much of his existing responsibilities relate to implementing safeguards on the company’s information, including protecting highly sensitive data on CompuCredit’s consumers. “As a natural extension of that I will formalize measures to ensure that our privacy policies continue to meet or exceed the requirements of the evolving new privacy regulations under consideration across the country and in Congress.” Lawrence will report directly to Rick Gilbert, CompuCredit’s Chief Operating Officer. Gilbert said, “Since the company was founded, we have always maintained a high degree of integrity in regards to consumer information. The appointment of a Chief Privacy Officer and the selection of Mr. Lawrence for this role simply reinforce our ongoing commitment to be a leader in this arena.

CompuCredit is a technology company, so it is most appropriate that our data is watched over by our technology experts.” CompuCredit also recently announced that it had retained the expertise of Dr. Alan Westin and his firm, Privacy Consulting Group, to provide ongoing counsel on consumer privacy issues. And, as a matter of policy CompuCredit annually provides its customers certain options regarding how information can or cannot be used.

CompuCredit Corporation is a credit card company that uses analytical techniques, including sophisticated computer models, to identify consumers who it believes are credit-worthy and are overlooked by more traditional consumer credit providers. CompuCredit markets unsecured Aspire(R) Visa(R) credit cards through direct mail, telemarketing and the Internet. In July 1999, CompuCredit launched its consumer web site, [www.aspirecard.com][2], through its Internet marketing services subsidiary AspireCard.com, Inc. Consumers can apply online and receive a credit decision within seconds. CompuCredit also markets credit life insurance, card registration, buying club memberships and travel services to its cardholders. Aspire Visa cards are issued by Columbus Bank and Trust Company under an agreement with CompuCredit. CompuCredit completed its initial public offering in April of 1999 and was included in the Russell 2000(R) Index in July 1999 and the NASDAQ FIN-100 Index in May 2000.

[1]: /graphic/aspire/aspire.gif
[2]: http://www.aspirecard.com/


CreditGroup Deal

creditgroup.com Inc., a leading provider of credit and financial services announced Wednesday that has acquired Asset Retrieval and Acquisition Fund, LLC of San Diego.

The acquisition gives creditgroup.com, Inc. a portfolio of tertiary and older accounts with a face value of approximately $ 27.5 million. CRCO will stratify the portfolio and vend those portions that do not meet it’s corporate mandate. Dr. Barry Lotz, chairman and chief executive officer stated, “Our motivation is to acquire companies that exhibit the ability to grow rapidly when financed and managed appropriately. ARAF will contribute significantly to our consumer loans, consumer credit card and judgement collection businesses. Our acquisition of and financial participation in ARAF will enable ARAF to grow significantly and add to the overall success of creditgroup.com Inc.”

About creditgroup.com Inc.

creditgroup.com Inc. was founded in 1997 and became public in 1998. creditgroup.com Inc. is headquartered out of San Diego and has another office in Vancouver, British Columbia, Canada. creditgroup.com Inc. acquires, manages and collects delinquent consumer receivables utilizing an information-driven strategy. The Company uses proprietary technology to acquire receivables primarily consisting of charged-off MasterCard(R), Visa(R), and private label credit card accounts issued by major banks and merchants. creditgroup.com Inc. is a socially responsible corporation emphasizing the consumer’s ability to regain their credit standing in the community. creditgroup.com maintains a solution based business philosophy that benefits consumer, lending institutions and ultimately investors. Their Internet address is [www.creditgroup.com][1].

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


Gas Pump ATMs

Diebold, Incorporated has modified its popular 1075ix exterior, walk-up cash dispenser for use as a freestanding terminal at gas station fuel pump islands. This allows automated teller machine and debit card users to purchase gas from the pump and obtain cash from an ATM without having to enter the store.

The new cash dispenser is an industry first. It was developed in response to a request by First Union as part of its effort to add further convenience for its customers. The first 1075ixS received UL approval and is now in operation at a convenience store in Goldsboro, N.C. To achieve UL certification for use at gas station fuel pump islands, Diebold engineers modified or replaced several motors and added special sealing to the enclosure to reduce the potential for ignition of fuel vapors by a spark.

“We think of the Diebold 1075ixS as a branch extension to put First Union services closer to where our customers can conveniently access them,” said Carol Malicki, senior vice president of ATM Solutions Research and Development at First Union. “First Union has a reputation for pushing the limits of technology as we search for ways to better serve our customers. Diebold has shown a willingness to innovate with us and help us stay on the leading edge of technology.”

The 1075ixS is a freestanding, walk-up cash dispenser designed for exterior installations. Because it is resistant to both weather and vandalism, no special structure or enclosure is required.

“Most ATMs today are being placed in non-traditional locations,” according to Thomas W. Swidarski, Diebold vice president, Global Marketing. “When First Union came to us with the idea to develop a cash dispenser that could actually be located on a gas station’s fuel pump island, we were eager to work with them to make the concept a reality. Customer ideas constantly drive us to develop new and innovative solutions like the 1075ixS that help ensure Diebold will continue to expand the potential applications for our ATMs.”

First Union (NYSE:FTU), with $254 billion in assets and stockholder’s equity of $17 billion at March 31, 2000, is a leading provider of financial services to 16 million retail and corporate customers throughout the East Coast and the nation. The company operates full-service banking offices in 12 East Coast states and Washington, D.C., and has full-service brokerage offices in 41 states.

Diebold, Incorporated is a global leader in providing integrated self-service delivery systems and services. Founded in 1859, Diebold employs more than 10,000 associates with representation in more than 75 countries worldwide and headquarters in Canton, Ohio, USA. Diebold reported revenue of $1.3 billion in 1999 and is publicly traded on the New York Stock Exchange under the symbol `DBD.’ For more information, visit the company’s Web site at [www.diebold.com][1].

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