HNC – OSI Merger Off

HNC Software Inc. announced Monday that it has commenced negotiations with Open Solutions Inc. to establish a strategic alliance with OSI.

The proposed alliance would be implemented in lieu of the parties’ previously announced plans to merge and is expected to involve a cooperative marketing relationship and a minority equity investment in OSI by HNC. HNC believes such a strategic alliance is preferable to a merger at this time, due to current uncertainty in the small to medium-size banking business environment.

OSI, a privately-held company based in Glastonbury, Conn., develops and markets client/server software that addresses core processing functions of small and medium-size banks and credit unions. HNC believes that the proposed strategic relationship will enable HNC Financial Solutions and OSI to exploit synergies between those of their products that address complementary applications.

“OSI’s products fit very well with some of our retail banking solutions,” said Michael A. Thiemann, HNC Financial Solutions Group president. “We intend to move full-speed ahead to integrate the FTI GL product into OSI’s The Complete Banking Solution(R), while also exploring which of our predictive products will be of most benefit to OSI’s market.”

Douglas K. Anderson, chairman & chief executive officer of Open Solutions Inc., commented, “There’s no doubt that introduction of HNC’s predictive modeling and analytical tools will provide community banks with technology that previously only large institutions could employ. However, although we initially contemplated a merger, both management teams have come to believe that at this time a strategic alliance is the best way to keep our respective organizations focused on making the right product decisions.”

OSI has its headquarters in Glastonbury, Conn., with several sales offices throughout the United States. OSI’s products, The Complete Banking Solution(TM) and The Complete Credit Union Solution(TM) are sold and installed in community banks and credit unions for complete core data processing in a pure client/server environment.

Features include deposit and loan processing, teller and platform automation, electronic forms, investor reporting, office automation and a marketing-style CIF. Additional information can be obtained by contacting Michael D. Nicastro, vice president of marketing, or via the Internet at [www.opensolutions.com][1].

HNC Financial Solutions, an HNC Software business group, provides a powerful set of predictive business solution modules that address the mission-critical, customer-lifecycle management needs of financial institutions. HNC Software Inc. (Nasdaq:HNCS) is a world leader in the development and delivery of predictive software solutions in client/server environments.

With headquarters in San Diego, HNC Software Inc. provides innovative predictive software systems in the financial services, retail, insurance information, electronic commerce, and telecommunications markets.

For more information on HNC, contact Jane Leonard, HNC Software Inc., 5930 Cornerstone Court West, San Diego, Calif., 92121, 619/546-8877. For investor relations hotline, call 800/396-8052.

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

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Card System Gold

Diebold introduced ‘Card System Gold; yesterday which enables campus administrators to deploy a one-card system capable of managing an array of transactions, including meal plans, access control, entitlements, stored value, vending, point-of-sale retail and remote management of other computer-based services.The University of North Carolina at Chapel Hill began taking advantage of CS Gold’s features at the beginning of the 1998-99 school year as a test user. Nearly 45,000 UNC campus cards were issued, giving cardholders access to services in 75 buildings across the campus.

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CCM in Beta

Greenland Corporation announced that on January 7, 1999, it had installed its first production ready, automated check-cashing machine in Santa Ana, CA for beta testing.  This machine is a freestanding kiosk with automated payroll check-cashing capability, full ATM functionality, and money order dispensing services.  The machine was installed in a multi-service food market.

The Company said that the beta testing has been successful and that testing will continue for a total of 60 days.

The Company anticipates that another test site will be established in the next ten days and that information being gathered will support demographic data regarding the selection of site locations.

Lee Swanson, CEO and President of Check Central, the wholly-owned subsidiary of Greenland that is developing this technology, stated, “The response to the new machine and technology has been very positive.  The storeowner and customers have been very enthusiastic about having this service available to them.  Potential distributors and purchasers who have visited our beta site have been very complimentary of the unit’s appearance and the simplicity in which it provides financial services.  Based on the success of these beta tests, the Company should begin to deliver production units by the end of the first quarter 1999.”

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MC-Cook Euro Cheques

To meet the needs of a changing European market and further demonstrating its commitment to providing global travelers with new products and services, MasterCard International announced the launch of a new travellers cheque denominated in Euros.

The Euro-denominated travellers cheques, issued by Thomas Cook, are available for sale immediately in denominations of 50EUR and 100EUR.

Consumers can use the Thomas Cook MasterCard Euro Travellers Cheques exactly as they would any other currency travellers cheque in the 11 European countries where the Euro is now established — Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Portugal, and Spain.

Merchants will accept the Thomas Cook MasterCard Euro Travellers Cheques for goods and services while banks will exchange the cheques for local currency, until the Euro currency is launched in January 2002 — enabling consumers to travel among participating EMU countries without carrying different currencies.

“MasterCard is pleased to partner with Thomas Cook in launching a Euro-denominated travellers cheque, a product that makes travel more convenient for consumers as more and more European countries transition to a single currency,” said Ralph Bianco, senior vice president, Global Product Management & Development, MasterCard International. “We are committed to developing value-added products and services that meet the evolving needs of today’s traveler.”

The Thomas Cook MasterCard Euro Travellers Cheques have all the benefits of traditional travellers cheques including security, widespread acceptance, and refundability. Consumers can purchase the new travellers cheques in banks, financial institutions, and any Thomas Cook Bureau de Change worldwide. The Euro Travellers Cheques will be based on the fixed national currency unit — the Euro Exchange Rate.

“With the Euro becoming the single currency of Europe, budgeting for travel expenses is even easier since no local currency conversions are required,” Bianco said. “The new Euro-denominated Thomas Cook MasterCard Travellers Cheques give consumers a complementary product to credit and debit cards when traveling.”

Additional cheque denominations of 20EUR and 200EUR will be available in 2001. Other MasterCard/Thomas Cook national currency denominated travellers cheques continue to be valid indefinitely, and can be exchanged for Euro-denominated travellers cheques at any time.

MasterCard International has the most comprehensive portfolio of payment brands (MasterCard, Maestro, Mondex, and Cirrus) in the world. With 23,000 member financial institutions, serving consumers in 220 countries and territories, MasterCard is the industry leader in quality and innovation. More than 600 million MasterCard, Maestro and Cirrus cards are accepted at more than 15 million locations worldwide. In 1997, gross dollar volume exceeded $600 billion. MasterCard can be reached through its World Wide Web site at .

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Cendant Card Enhanced

Cendant Business Services has announced an industry first: the Cendant Card, the MasterCard-branded one-card solution for managing T&E, purchasing and fleet expenses, now provides enhanced information capture on vehicle maintenance purchases.

“When it came to paying for vehicle maintenance expenses for sales and service people, information capture was a challenge for the charge card platform,” says William Brooks, General Manager of Cendant Business Services. “Managers needed to be able to capture line-item detail on transactions such as oil changes, new tires or repairs, and store them in a database that could be accessed throughout the life of the company vehicle. Now, the Cendant Card has developed a network that captures this kind of information on a one-card platform. And it’s provided in a way that uses our data warehouse and makes reporting easy, while helping managers maintain control of maintenance spending. This is a capability that’s unique to the Cendant Card and truly enhances its value to the corporate buyer and manager.”

Robust maintenance information via the Internet Whether  corporate fleet has 100 or 10,000 vehicles, vehicle maintenance is an expense that needs to be tightly controlled. Detailed information is the key to managing costs and making vehicle replacement decisions. In the past, this kind of information was available only on private-label cards provided solely by fleet management companies.

Cendant Business Services has broken new ground by developing the network and data capture capabilities necessary to effectively manage vehicle maintenance. The Cendant Card is the only multi-purpose card on the market today that can track this information whenever a person driving a company vehicle uses the Cendant Card at a network of nationally recognized vehicle service facilities.

In addition to this enhanced information capability, only the Cendant Card enables managers to monitor purchasing activity online via the Internet at [www.cendantbusiness.com][1]. They benefit from real-time information, available any time from any place in an easy-to-use format. Information can be manipulated in thousands of interactive inquiries and a variety of standard reports. Managers can also create ad hoc reports based on their specific needs and interests.

Cendant Business Services is the commercial card division of Cendant Corporation , one of the world’s foremost providers of consumer and business services. Cendant Business Services markets the multi-purpose, MasterCard-branded Cendant Card for travel & entertainment, purchasing and fleet services, as well as niche private label and co-branded cards.

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

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Edwards to SkyMall

SkyMall Inc. announced Friday the appointment of industry veteran Thomas C. Edwards as skymall.com’s chief marketing officer. Edwards was SVP of emerging technology and business development at VISA.. Prior to his work at VISA, Edwards served as vice president of marketing and product development at Citicorp Credit Services Inc. and in various marketing and management positions with the American Express. As chief marketing officer, Edwards’ goals at SkyMall will be to strengthen skymall.com’s site content to attract a greater number and variety of visitors, develop new strategic host partner alliances and forge additional merchant relationships.

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People’s Surpasses $4 Billion

CT-based People’s Bank reported Friday it held more than $4 billion in bank credit card receivables at the end of 1998 representing an annual increase of nearly 18%. People’s U.K. portfolio soared by 45%, reaching $248 million as of Dec. 31, 1998. The issuer also announced Friday it changed some credit card accounting policies which reduced fourth quarter pre-tax earnings by $1.6 million. In the first change, credit card receivables are charged off in the month that an account becomes 181 days delinquent (up to two months earlier than prior practice). In the second change, People’s modified its accrual practices for recognizing credit card finance charges, resulting in a one-time increase in interest income on managed credit card loans for the fourth quarter. Despite the accounting changes, People’s charge-off and delinquency rate both dropped during the fourth quarter. People’s did point out Friday that its managed credit card yield of 10.20% declined 68 basis points from 10.88% for the year-ago quarter and declined 51 basis points from 10.71% for the third quarter of 1998.  These declines reflect a substantial volume of new credit card balances at introductory rates, the current interest rate environment and intense competition. People’s says the introductory rates are exerting short-term pressure on yields but profits should grow as these balances reprice upward to full market rates. For complete 4Q/98 details on People’s visit CardData ([www.carddata.com][1]).

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

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GE Settlement

GE Capital’s $100 million settlement with bankrupt debtors was approved Friday by a federal judge. The class action suit, filed in the spring of 1997, accused GE and its Montgomery Ward portfolio of unfair debt collection practices in regard to the reaffirmation of credit card debts by customers who filed bankruptcy. Under terms of the settlement GE will refund, with interest, all credit card payments made after debtors entered into the reaffirmation agreements between Jan. 1, 1993, and June 30, 1997. GE also agreed to advise credit bureaus to correct any negative credit reports related to class members’ failure to pay reaffirmed debt and will contribute about $2 million to consumer education programs.

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Providian Up 78%

Providian Financial reported last week record fourth quarter net income of $94.9 million, a 78% increase over earnings per share for the fourth quarter of the prior year. Account growth climbed at an accelerated pace, with over 1.9 million new account relationships established during the quarter.  This includes 600,000 accounts added through the acquisition of the Bravo card program in December, bringing Providian’s total managed accounts at the end of 1998 to 8 million, representing a 71% growth rate over year-end 1997. For the fourth quarter, the managed net credit loss rate, excluding acquired portfolios, was 6.54% versus 6.42% in the fourth quarter of 1997, while for all of 1998 the managed net credit loss rate, excluding acquisitions, was 6.33% versus 6.32% in 1997. Including the acquired portfolios, the total managed net credit loss rate was 7.58% in 1998, versus 6.32% for 1997.  The 31+ day managed delinquency rate was 5.33% at year-end 1998. For complete 4Q/98 details on Providian visit CardData ([www.carddata.com][1]).

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

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MasterCard & 1travel.com

MasterCard International ([www.mastercard.com][1]), and 1travel.com ([www.1travel.com][2]), a leading online discount travel service, announced Friday a marketing alliance designed to increase the number of online discount travel shoppers to the 1travel.com site and to provide consumers with special travel offers, discount packages and upgrades.

The alliance makes MasterCard the preferred payment system and an exclusive marketing partner with 1travel.com, and will provide MasterCard cardholders with exclusive travel and entertainment offers, special promotions and other discounts. In addition, the program will feature a link on the 1travel.com Web site to the MasterCard Web site that allows shoppers to access information on travel benefits, products and services, and MasterCard’s ATM locator service. The ATM locator service enables travelers to find the nearest ATM anywhere in the world.

“As the leading way to pay for travel services online, MasterCard is proud to partner with 1travel.com to offer special incentives to consumers,” said Ralph Bianco, senior vice president, Global Product Management & Development, MasterCard International. “As e-commerce continues to grow, particularly in the areas of travel and entertainment, MasterCard continues to provide consumers with the ultimate flexibility in making purchases from anywhere – including cyberspace.”

MasterCard’s preferred status will appear on 1travel.com’s Home Page as well as a number of additional 1travel.com proprietary Web pages that assist consumers in finding the best airfares, and hotel and car rental deals. These Web pages include Lowest Airfares, Car Wiz and Hotel Wiz.

“We are happy to have MasterCard as our preferred payment brand on 1travel.com,” said Michael Thomas, President and CEO of 1travel.com. “Our customers are value-oriented, computer-savvy and will benefit from this new partnership through a variety of joint promotions with MasterCard. Having MasterCard as 1travel.com’s preferred payment choice will provide consumers with the credibility of a trusted brand.”

Online Security

MasterCard’s alliance with 1travel.com is part of its on-going e-commerce initiative to build consumer awareness of the benefits of shopping online. The 1travel.com Web site will be designated one of MasterCard’s “Shop Smart!” sites. “Shop Smart” is an online consumer awareness program that certifies to consumers that they are shopping on a Web site that uses the most advanced safety practices for online transactions. When consumers see the “Shop Smart!” logo on a Web site, they can feel confident knowing that the merchant is using best available security and practices to safeguard their payment information.

The security section of 1travel.com will feature information on Secure Electronic Transaction (SET), the Internet security protocol MasterCard helped develop, which secures online credit card payments by encrypting cardholder information and properly identifying the cardholder and the merchant to one another. 1travel.com will actively work with MasterCard to ensure that 1travel.com technical solutions with respect to transaction security meet MasterCard’s rules, policies and procedures regarding the security of credit card numbers.

MasterCard Travel Alliances

In addition to the 1travel.com alliance and further emphasizing MasterCard’s commitment to the travel category, MasterCard has formed alliances with other travel providers including American Airlines Vacations, Jet Vacations and the SABRE Leisure Travel Alliance, which provides innovative packages and products to leisure travelers through travel merchants.

These alliances are one of the cornerstones of MasterCard’s global T&E strategy to further its leadership and presence in the T&E market segment. Also, MasterCard is working with government tourism organizations to promote travel to popular destinations including Mexico, Canada and France while expanding its travel product and service offerings such as MasterCard Global Service(tm) and the World MasterCard(R) card.

About MasterCard

MasterCard International has the most comprehensive portfolio of payment brands in the world. With 23,000 member financial institutions, serving consumers in 220 countries and territories, MasterCard is the industry leader in quality and innovation. More than 600 million MasterCard(R), Maestro(R), Cirrus(R) and Mondex(tm) cards are accepted at more than 15 million locations worldwide. In 1997, gross dollar volume exceeded $600 billion. MasterCard can be reached through its World Wide Web site at .

About 1travel.com, Inc.

www.1travel.com is a full-service, online discount travel site dedicated to bringing consumers the best values in travel by allowing direct purchases of airline tickets, hotel rooms, cruises and tour packages with savings of up to 70% off regular retail prices. 1travel.com has recently launched [www.hotelwiz.com][3] offering discounts and direct bookings at 43,000 properties worldwide. The company has also developed www.farebeater.com the only airfare system of its kind that simultaneously searches multiple databases to find travelers the best prices on flights. 1travel.com headquarters is located in Zionsville, PA with ticketing and fulfillment offices in Odessa, Texas.

[1]: http://www.mastercard.com
[2]: http://www.1travel.com
[3]: http://www.hotelwiz.com

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Fleet vs Advanta

Fleet Financial Group reportedly filed suit against Advanta Corp. late Friday in regard to its acquisition of Advanta’s credit card portfolio last year. The suit alleges Advanta “breached its fiduciary duty” and sought an “accounting for conversion of funds”. The suit was filed in Delaware Chancery Court. More details were emerge today as the Court officially releases details. For the latest update monitor CardFlash Online.

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Charge-Off Sales

St. Louis-based National Loan Exchange reported Friday that it disposed of $309 million of charged-off accounts, mostly bank credit card accounts, during the fourth quarter for an average premium of 5.51%. The lowest premium of 1.00% came from a $3 million portfolio that was worked by at least two agencies and with only 50% of the accounts in-statute. The highest premium of 11.25% came from a $75 million portfolio of a leading card issuer with a three month forward flow of fresh charge-offs.

CHARGE-OFF PORTFOLIO  SALES  (4Q/98) —  SAMPLING
DESCRIPTION     AGENCIES   IN-STATUTE   PORTFOLIO     PRICE
Canadian Cards 2 100% $26M $988K
Dept. Store Cards 0 100% $1.4M $150K
Regional Cards 2 100% $4.0M $144K
Natl Cards 3 32% $110M $2.2M
Regional Cards 0 100% $500K $50K
           Source NLEX;  M-millions;  K-thousands;

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