Fleet Financial Group agreed to purchase $600 million in credit card receivables for a $48 million premium from VA-based Crestar Bank yesterday. The receivables represent 400,000 accounts located outside of Crestar’s geographic footprint of Virginia, Maryland and Washington, D.C., or about half of Crestar’s total card portfolio. Crestar has been dogged by high charge-offs among its national card accounts. About 85% of Crestar’s net charge-offs came from its credit card portfolio. Crestar indicated the sale will produce a total gain of about $54 million to be used towards expanding its consumer and commercial lending businesses. The sale is expected to close this fall. Fleet currently holds $15 billion in card loans among more than 8 million accounts. According to CardData, at the end of the first quarter, Crestar had $1,118,425,219 in receivables; $330,873,539 in quarterly volume; 881,404 gross accounts; 477,121 active accounts and 939,229 cards-in-force.Details
Yesterday’s Fleet acquisition added more marketshare for the Top 10 U.S. bank credit card issuers. Considering mergers and acquisitions in motion, the top 10 will hold nearly a 70% marketshare, based on first quarter 1998 data. The top 5 will hold more than 50% of the bank credit card market while the Top 25 will account for more than an 85% marketshare, according to CardData.
The Top Ten (Pending Mergers & Acquisitions)
1. Citibank/Universal $60.1 billion
2. Bank One/FUSA/FCC $54.8 billion
3. MBNA America $45.1 billion
4. Discover $35.8 billion
5. Chase Manhattan $31.4 billion
6. BofA/NationsBank $19.9 billion
7. Household/Beneficial $17.5 billion
8. Fleet/Advanta/Crestar $15.5 billion
9. Capital One $13.2 billion
10. AmEx Optima $10.0 billion
TOTAL: $303.1 billion (or 70% marketshare)
based on 1Q/98 data from CardData
Wachovia Bank, N.A. has completed installation of automated teller machines in 29 locations in the Atlantic Coast counties of Palm Beach, Brevard, Broward and Martin in Florida. Another eight locations are slated to be added later this summer.
“The recent ATM installations bring added convenience to former 1st United and American Bank customers – as well as other Wachovia customers traveling in Florida,” said Warren S. Orlando, Wachovia’s chief executive for Florida banking. Non-customers whose banks are members of the Honor, Plus and Cirrus networks as well as American Express, Discover, MasterCard and Visa cardholders can use the ATMs for a usage fee per transaction.
1st United Bank last week merged with Wachovia Bank, N.A. Earlier this year, American Bank of Hollywood merged with 1st United. The new ATMs are located in 20 cities in the four-county region that has been served by the two banks.
“Wachovia’s Florida ATM program is part of our commitment to customer service,” said Rebekah Lowe, regional executive. “We are excited about extending 24-hour ATM service to branches previously without that capability.”
Wachovia signs will be installed at all former 1st United and American Bank locations during the weekend of Aug. 28, when existing operations will be integrated with Wachovia.
Wachovia Bank, N.A. is the principal banking subsidiary of Wachovia Corporation and has more than 750 offices and 1,300 ATMs in Florida, Georgia, North Carolina, South Carolina and Virginia. As of March 31, Wachovia Corporation ranked 18th among U.S. bank holding companies with assets in excess of $65 billion.Details
DIGITEC 2000, Inc. announced Thursday the successful launch of its ‘New York Direct’ card, the company’s first local access prepaid long distance phone card over its own facilities. The new card provides New Yorkers in area codes 212, 516, 718 and 914 with the ability to call anywhere in the USA for 5 cents per minute after a 25 cent connection fee.
“The combination of local access and use of our dedicated facilities enables us to price the service at only 5 cents per minute, which is truly an exceptional rate for our customers,” observed Diego Roca, Chief Operating Officer. Roca continued, “This attractive 5 cents per minute rate is expected to generate the calling volume needed to keep our facilities costs low and enable us to make money while providing a reliable, high quality service.”
The initial positive market acceptance of its first ever local access prepaid card confirms the company’s business plan to roll out this service in other major cities nationwide. Discussions are currently in progress to obtain the facilities to launch comparable cards in several major metropolitan areas in the very near future. Thereafter, the company plans to market similar cards in additional major cities and anticipates that these cards will play an integral role in Digitec’s transition to a global facilities-based carrier instead of a provider of bundled service prepaid cards.
Digitec 2000, Inc. is a leading provider of prepaid telecommunications products and services. The Company develops customized corporate and affinity prepaid phone card programs as well as promotional and premium programs for major corporations. The Company’s Digitec Direct, F/X, F/X Mexico, F/X South America, and Caribbean Direct are among the most prominent brands in the retail market.Details
Sun Company, Inc. (Sunoco) and NYCE Corporation announced today that consumers can now use ATM cards bearing the NYCE logo to make purchases at all Sunoco retail outlets. Sunoco, which has nearly 3,800 locations in 17 Northeastern states, will accept NYCE cards for PIN-based debit purchases for both in-store and “pay at the pump” sales.
“We are pleased to add NYCE debit cards to our payment options at Sunoco service stations, Aplus convenience stores, and Ultra Service Centers,” said Jim Kline, credit card marketing manager for Sunoco. “NYCE has a strong presence in our market, and we believe NYCE cards provide a real convenience to our customers.”
“As consumers continue to increase their reliance on ATM cards, we have seen dramatic growth in the types of merchants accepting the cards, the number of locations where the cards can be used, and the total volume of POS transactions,” said Susan A. Zawodniak, vice president at NYCE Corporation and executive director of the NYCE Network. “We are committed to maintaining this momentum and expanding POS availability for NYCE cardholders. And we are especially proud to welcome Sunoco to the NYCE Network.”
Sunoco is sponsored into the NYCE Network by Charlotte-based First Union National Bank.
Sun Company, Inc., headquartered in Philadelphia, is one of the largest independent petroleum refiner-marketers in the United States. Sun operates five domestic refineries with approximately 700,000 barrels per day of crude oil processing capacity and markets gasoline under the Sunoco brand through approximately 3,800 Sunoco outlets in 17 states from Maine to Virginia and west to Indiana. Sun sells lubricants and petrochemicals worldwide, operates domestic pipelines and terminals, and manufactures metallungical-grade coke for use in the steel industry.
Based in Woodcliff Lake, New Jersey, NYCE Corporation provides merchants and financial institutions with flexible, state-of-the-art processing services that support automated teller machine (ATM), point-of-sale (POS) and electronic benefits transfer (EBT) transactions. In addition, NYCE offers telephone and PC-based banking and bill payment solutions, ATM terminal driving, card authorization and management, and gateway access. The corporation also operates the NYCE Network, the largest shared regional electronic funds transfer (EFT) network in the Northeast.
As of June 30, 1998, more than 1,300 financial institutions participate in the NYCE Network, providing ATM and related payment services to more than 31.1 million cardholders through more than 19,500 ATMs and more than 133,000 POS merchant locations.Details
ProMark One, a leading provider of outsourced teleservices solutions within IDRC USA’s Outbound unit, announced that Sonia Benson and Melissa Hough were promoted from Client Service Managers to Senior Client Services Managers for IDRC USA.
In their new roles as Senior Client Services Managers, Benson and Hough will serve as escalation points for internal and external client problem resolution for IDRC USA’s Outbound unit. In addition, they will serve as mentors, trainers, and team leaders for our rapidly growing client services staff. This new position is intended to help provide the type of ongoing, intensive education and development necessary to sustain and grow the world class client service management IDRC’s clients have come to expect.
Benson started with ProMark One as a Client Services Manager in January 1997, and has more than four years’ experience working in the direct marketing industry. Throughout her career, Benson has worked mostly in a Client Services capacity; however, she also has an extensive sales background in retail, advertising and fulfillment services. Benson has a BS degree in Marketing from Arizona State University. In her new capacity at Senior Client Services Manager, Benson will be responsible for IDRC USA Outbound’s Financial Services clients.
Hough started with ProMark One in April of 1996 as a Client Services Manager. Hough has spent the last 10 years working in the telemarketing industry, and has extensive experience in account management and operations. In her previous position, Hough was responsible for all client relations and day-to-day operations functions for a Time Warner Cable in-house call center. In her new position, Hough will concentrate primarily on IDRC USA Outbound’s Telecommunications clients.
IDRC USA is pleased to formally recognize Benson and Hough’s contributions as they help us build a bigger and stronger company.
IDRC USA specializes in providing inbound and outbound telephone based solutions that target businesses and consumers in a variety of industries, including telecommunications, financial services, and insurance, among others. IDRC USA uses customized, state of the art computer and telephone based technologies in its operations. IDRC USA’s focus is to work with selected business partners, helping them to maximize the lifetime value of their customers through the effective use of telephone based support.
IDRC USA consists of two recently formed functional operating units, IDRC USA Outbound and IDRC USA Inbound/Customer Care. Based in Scottsdale, Arizona, IDRC USA Outbound consists of the ProMark One (IDRC’s largest subsidiary), IntelliSell and Telnet business units. Based in San Diego, the IDRC USA Inbound/Customer Care unit consists of our newly constructed state of the art inbound facilities in Buffalo and San Diego.
Through the combined resources of these companies, IDRC USA is able to offer a wide spectrum of fully integrated services to clients throughout North America. Currently ranked as the nation’s third largest telemarketing service agency, IDRC USA currently has nearly 4,600 employees, 2,700 workstations and 18 call centers located throughout the U.S.
IDRC USA’s corporate office is located at 7272 E. Indian School Road, Suite 350, Scottsdale, Arizona, 85251. For more information about IDRC USA or ProMark One, contact Dawn Wahler, Marketing Manager, at 800-933-0233.Details
Equifax said Thursday it will acquire Phoenix-based The Decisioneering Group Inc., a transformation think-tank specializing in knowledge engineering and strategic consulting solutions. The Equifax business unit formed with the acquisition of The Decisioneering Group will create, offer and deliver world-class, strategic-level business and decision analytics across the banking, retail, telecommunications, utilities, insurance, transportation industries, and government. Equifax says the acquisition brings knowledge-based decision solutions to enterprises by “mining” a wide range of information on consumers, distribution channels and products to better define lifecycles and predict relationship opportunities.Details
A Florida firm, which has developed a ‘Global Gaming Pay Out System’, announced Thursday it will launch the ‘Winners Debit Card’. Winners Internet Network, Inc. says the new debit card will be accepted at over 250,000 locations in 17 countries. Cyberlink Monetary System Trust will be providing the gaming debit card and also intends to issue another debit card to be used by other vendors in non-related gaming businesses and by shoppers worldwide. Winners Internet enables players to choose an online casino of their choice and then track wins and losses at each licensed site via Winners’ proprietary systems. The company says there are currently over 55 Internet gaming sites in operation with an annual volume of approximately $100 million. The firm projects legal Internet gaming could reach $10 billion within 5 years.Details
The days of your wallet being weighed down by a stack of payment cards may be numbered following a $23 million deal announced yesterday between NCR Corporation and Britain’s banks and building societies.
The initiative, led by the Association for Payment Clearing Services (APACS), will see all NCR Automated Teller Machines (ATMs) — more than 80 percent of the UK’s 22,000 terminals — upgraded so that they can read the data held in a smartcard’s chip and potentially enable the cards to be loaded with electronic money.
With a built-in silicon memory chip, a smartcard can perform many functions that would currently need several different cards. Apart from storing electronic cash, smartcards can also act as debit and credit cards. They also have the potential to store information on anything from drivers’ licenses to travel tickets and frequent flyer programs.
The deal makes Britain a world leader in smartcard compatibility as this will be the first national roll-out to use the international Europay MasterCard Visa (EMV) standard. The conversion to the new technology is scheduled to begin in the third quarter of 1998, and all installed NCR ATMs will be upgraded to accept smartcards by the end of 1999.
The silicon chips in smartcards — which will replace the traditional magnetic strip in a conventional bank card — also make the card highly secure, further advancing the fight against card fraud.
This announcement follows APACS smartcard tests in the UK, where consumers have been using their cards to pay for a wide range of goods and services. As part of the deal, NCR will install new software and smartcard readers into existing ATMs and replace older machines with new smartcard-compatible terminals. Magnetic strip cards will continue to work in upgraded ATMs.
“This deal has sent out a clear message that Britain is a world leader in consumer banking,” stated Per-Olof Loof, senior vice president of NCR’s Financial Solutions Group. “Our own recent research has shown that nearly three quarters of UK consumers want to use the type of added-value services smartcards and ‘smart’ ATM technology will enable, from checking the number of loyalty points earned to storing and using electronic cash.
“APACS’ decision heralds much more than just the opportunity to streamline our wallets and reduce fraud. It allows banks to deliver innovative new products and consumers to exercise greater control over their personal finances.”
“The new infrastructure will ensure the UK continues to be at the forefront of financial services in the ever-changing world of electronic banking,” added Paul Marsh, head of card services at APACS. “UK banks will benefit from economies of scale and have clearly demonstrated their commitment to chip card technology.”
About NCR’s Financial Solutions Group
NCR supplies banks and other financial institutions with Banking Solutions in the Age of the Consumer — solutions that are tailored to our customers’ individual needs so that they can offer the best services to their consumers. These solutions cover the areas of self-service, payment, channel delivery and customer management. NCR shipped a record 42,440 ATMs world-wide in 1997, maintaining its 11th straight year of leadership, including 8,441 units to off-banking premise locations in the United States.
NCR Corporation is a recognized world leader in scalable data warehousing, self-service and store automation solutions for the retail, financial and communications industries and other select markets. NCR’s solutions are built on the foundation of the company’s long-established industry knowledge and consulting expertise, value-adding software, world- leading hardware technology, global customer support services and a complete line of consumable and media products. More information on NCR and its products can be found on the World Wide Web at: . The Financial Solutions press room is at .
APACS is the industry body for the major UK banks and building societies for payment services including card payments.
APACS and it members have worked in co-operation with the international card schemes, Europay, MasterCard and Visa, to develop the international chip specification (EMV) and are working with the UK networks, LINK and Switch and also with AMEX, to ensure that UK-issued cards are fully acceptable in this country and abroad.
Members of APACS Card Payments Group include: Bank of Scotland, Barclays Bank, Lloyds TSB Group, MBNA International Bank, National Westminster Bank, Nationwide Building Society and The Royal Bank of Scotland Card programs which have been involved in the chip card project are: Europay International SA, MasterCard International, Visa International, American Express Europe Limited and SWITCH Card Services Ltd.Details
NCR Corporation announced Thursday an agreement with Australian-based Credit Union Services Corporation to supply more than $13 million worth of ATMs and support services over the next three years.
Under the terms of the agreement, NCR will provide Credit Union Services Corporation, which represents 217 Australian credit unions, with NCR personaS ATMs and assist with the rollout of advanced ATM services.
“Credit union members have long understood the convenience that ATMs have brought to banking,” said John Hall, general manager, Retail Banking, at Credit Union Services Corporation. “NCR’s long-standing expertise in both the financial and retail sectors will enable credit unions to provide their members with even greater convenience in the future.”
In addition to traditional financial services, the NCR ATMs will deliver multiple coupons, allowing customers to choose the coupon that most appeals to them. This will enable advertisers to offer customers incentives to sample products and gauge the effectiveness of a campaign by evaluating coupon redemption rates. NCR also anticipates future rollout of video-based advertising programs.
“The critical role of ATMs in providing a high level of banking convenience is creating a demand for advanced services,” said Dan Milton-Hine, NCR’s general manager, Self Service, South Pacific Area. “NCR’s personaS range of ATMs has the capability to evolve the traditional ATM role from cash dispensing to a multi-purpose product and service distribution channel.”
There are 246 credit unions in Australia with 3.5 million members and assets of more than $11 billion.
About Credit Union Services Corporation
Credit Union Services Corporation is the peak industry body and major service provider for Australian credit unions. The Corporation provides credit unions with treasury and funds management services, transaction services, various wholesale and retail banking products, insurance products, data processing and communications technology as well as public affairs, compliance, research, communication and related business services.
About NCR’s Financial Solutions Group
NCR supplies banks and other financial institutions with Banking Solutions in the Age of the Consumer — solutions that are tailored to our customers’ individual needs so that they can offer the best services to their consumers. These solutions cover the areas of self-service, payment, channel delivery and customer management.
NCR Corporation is a recognized world leader in scalable data warehousing, self-service and store automation solutions for the retail, financial and communications industries and other select markets. NCR’s solutions are built on the foundation of the company’s long-established industry knowledge and consulting expertise, value-adding software, world- leading hardware technology, global customer support services and a complete line of consumable and media products. More information on NCR and its products can be found on the World Wide Web at: .Details
Diebold confirmed yesterday it will eliminate more than 600 jobs, consolidate facilities, and undertake a corporate-wide realignment which will result in a one-time after-tax charge of $42 million against second quarter earnings. Yesterday’s announcements are the result of the recent slowdown in Diebold’s ATM business in the U.S. and its efforts to end the role of IBM as the company’s primary international distributor. Diebold is developing its own global distribution organization. As part of the company’s overhaul, Diebold will streamline product development organizations to remove cost from the products as well as increase speed to market. For example, Diebold will no longer develop and manufacture its own proprietary electronic security systems, but will become a true systems integrator utilizing more off-the-shelf OEM security products. The company will also eliminate a number of non-core products including certain self-service products, specific proprietary electronic security systems, and some legacy product lines from Campus Systems and Diebold Australia. When fully implemented, Diebold expects to save approximately $22 million annually as a result of the realignment.Details
The first smart card SET enabled payment transaction over the Internet was demonstrated yesterday at the E-GOV ’98 Conference in Washington.This application pilot is unique in its use of smart card technology in conjunction with SET transaction standards. The first-of-a-kind application pilot in the U.S. brings together Certicom, GlobeSet, MasterCard International, Mellon Bank, SETCo, Schlumberger Smart Cards & Terminals and the U.S. Treasury Financial Management Service, Bureau of Engraving and Printing to allow consumers, merchants and banks to utilize the SET protocol, in conjunction with a smart card, in Internet commerce transactions.Details