ELAVON PROCESSING

Elavon, formerly known as NOVA Information
Systems, has successfully converted its merchant
services business onto one international processing platform.
With the successful systems migration of over 210,000 European
merchants, virtually all of Elavon’s international acquiring volume is now processed on a single
platform. Elavon utilized multiple IT processing platforms to support its cross-border and multi-currency
international business and its domestic businesses in Belgium, Germany, Ireland,
Norway, Poland, Spain and the United Kingdom. By replacing multiple processing platforms
obtained through acquisitions with one consolidated international processing
platform, Elavon is better able to provide seamless support to global retailers
and other customers with multi-jurisdiction businesses.

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Credit Card Account Growth Slides 4% in 07

The number of general purpose credit card accounts has been slowly
deteriorating in 2007, declining from a peak of 573 million accounts at
the start of the year to 552 million at the end of the third quarter.
BofA and Chase reported a decline of 39% and 10%, respectively,
in the number of new credit card accounts opened during the third
quarter, compared to 3Q/07. According to CardData, Citi reported that
its credit card account base dropped 2.5% and Capital One posted a 7.8%
decrease in its U.S. credit card accounts of 7.8%, compared to the year-
ago quarter. BofA opened 1.77 million new credit card accounts globally
in 3Q/08, compared to 2.67 million in the prior quarter and 2.90 million
in the year-ago quarter. Chase opened 3.6 million credit card accounts
during the third quarter, the same as the prior quarter, but down from
4.0 million for 3Q/07. Citi’s North American credit card portfolio
shrank from 149.1 million accounts for 3Q/07 to 145.3 million for 3Q/08.
Capital One reports that its U.S. credit card account base declined from
41.1 million in the third quarter of last year to 37.9 million for the
third quarter of this year. For more details on third quarter credit
card performance visit CardData ([www.carddata.com](http://www.carddata.com)).

U.S. CREDIT CARD ACCOUNTS
(Visa, MasterCard, Discover & American Express)
3Q/07: 564 million
4Q/07: 573 million
1Q/08: 565 million
2Q/08: 561 million
3Q/08: 552 million
Source: CardData (www.carddata.com)

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OBERTHUR 3Q/08

Los Angeles and Paris-based Oberthur Technologies reported third quarter sales of $287.7 million, a 24% increase over 3Q/07. The Card Systems business, which became a completely separate division at the start of the quarter, posted a sharp 29% increase of $229.2 million in sales, compared to the year-ago quarter, driven by the integration of XPonCard. Payment card sales gained 18% in the third quarter to $46.8 million. Oberthur says the EMEA region and in particular Europe, suffered the joint effect of a drop in volumes, especially in the UK, and in the average sales price, with stability in the personalization services segment activity. In the USA, the magnetic stripe card market is depressed, affected by both the deterioration in economic conditions in the banking sector and price pressure. For complete details on Oberthur’s third quarter results visit CardData (www.carddata.com).

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CO-OP to Offer mFoundry’s Platform to CUs

CO-OP Financial Services has selected mobile banking solution provider mFoundry’s
financial services platform to deliver mobile banking offerings to credit unions.
The mFoundry platform will integrate into
CO-OP Shared Branching’s “Next Generation Network” switch to provide mobile
banking to members of all credit unions participating in its network to
allow credit union members to verify balances, view transaction history,
transfer funds among their accounts, and more—all through the use of their
cellular phones. CO-OP Financial Services is the nation’s largest credit union service
organization with 3,000 credit union members, 28,000 surcharge-free ATMs, 3,500
shared branch locations, over 120 million monthly transactions and 26 million
cardholders.

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Dynamic Card Solutions Cited by Deloitte

Dynamic Card Solutions has been named for a fourth year to Deloitte’s prestigious Technology Fast 50
Program for Colorado. The program is a ranking of the 50 fastest growing technology, media,
telecommunications and life sciences companies in the area by Deloitte LLP. Rankings are based on the
percentage revenue growth over five years from 2003–2007.
DCS is known for its innovation of instant issuance and PIN selection solutions
among financial institutions, has grown considerably over the last five years.
To qualify for the Technology Fast 50, companies must have had operating
revenues of at least $50,000 in 2003 and $5,000,000 in 2007, be headquartered in
North America, and be a company that owns proprietary technology or proprietary
intellectual property that contributes to a significant portion of the
company’s operating revenues; or devotes a significant proportion of revenues to
the research and development of technology.

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V/MC PIN Debit Settlement Notices Issued

NY-based Constantine Cannon, Lead Counsel for U.S. merchants in Visa Check/MasterMoney Antitrust Litigation, issued two letters this month regarding the settlement. The law firm says some merchants have been contacted by an entity or entities offering to purchase their rights to future distributions from the settlement fund. Constantine Cannon recommends merchants contact them first as they can provide a reasonable estimate of their share of any residual funds. Also this month, notices of estimated cash payment awards for PIN debit damages were mailed on October 15th. This applies to U.S. merchants that installed PIN pads and accepted PIN debit transactions at some time during the period of October 1992 through July 2003 and therefore are eligible to receive payment for PIN Debit overcharges.

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3G Americas Report Explains GSM Superiority

Wireless trade association 3G Americas has published “Security and Trust in Mobile Applications”
that reveals issues for consumers and application providers regarding trust and security.
The white paper discusses key applications and services that are on the
leading edge of those offered today and in the near future, such as near field
communications (NFC), mobile banking, eticketing, mobile broadcast
services and mobile payment as well as key security features in place today. It
provides examples of secure applications that are available today and in
the near future, and the primary differentiators for GSM technologies as compared
to other networks.

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Biz Owner Economic Confidence Erodes Again

Economic confidence among small business owners slipped again in October as 64% rate the economy as poor and and most do not see an end to the current global financial crisis. Also, about 57% of small business owners say the $700 billion economic rescue plan that was approved by the Congress and signed by the president earlier this month
does not bring much benefit to their business. The “Discover Small Business Watch” fell to 71.4 in October from 74.6 in September, the lowest confidence rating since the “Watch” was established in August 2006. However, the Discover research did find that 38% of small business owners say they have experienced cash flow issues over the last 90 days, down from 42% in the prior month. Also, 77% say that economic conditions have not forced them to borrow money to pay their bills. But, among those who are seeking loans, 70% say it is harder to borrow money right now. Additionally, 23% plan to increase spending on business development over the next six months, down from 28% in September and equaling an all-time low in the Watch.

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Retailers More Confident with Cyber Security

A recent survey found that 47% of retailers report that they do not
maintain customer credit card information. Of those who do keep credit
card information, 61% conduct periodic reviews of inactive accounts in
order to remove inactive card holder data. About 96% who do review
inactive accounts do so annually. According to the annual study
performed by BDO Seidman, 44% of CFOs at top U.S. retailers stated that
they have increased their level of investment in cyber security to
combat potential data breaches, down from 61% in 2007, indicating a
growing comfort with the protective systems in place.

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Citi Launches a Thanks-A-Million Promotion

Citibank has launched the “Thanks-A-Million” sweepstakes and will give away
5 million points to 16 lucky winners. Citibank will reward 16 winners with a total of 5 million Thank You
Points that includes two Grand Prizes: 1 million points each, four Second Prizes: 500,000 points each and
10 Third Prizes: 100,000 points each. New checking account holders
enrolled in the rewards program will be automatically entered for a
chance to win up to 1 million rewards points and new and existing checking
customers get an additional chance to win 1 million rewards points every time they use a
qualifying debit card and sign for purchases. New checking customers who enroll in
ThankYou Network can also get 10,000 bonus points when they perform qualifying
banking activities.

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VASCO 3Q/08

VASCO Data Security reports that it experienced an increase in the third quarter of 32% to $39.7 million
compared to $30.0 million for the third quarter of 2007, and for the first nine months of
2008, increased 17% to $104.0 million from $88.8 million for the first nine
months of 2007. Gross profit was $27.8 million, or 70% of revenue, for the third
quarter of 2008 and $73.3 million, or 70% of revenue, for the first nine months
of 2008. Gross profit was $20.0 million, or 67% of revenue for the third quarter
of 2007 and $58.2 million, or 66% of revenue, for the first nine months of 2007.
Net income for the third quarter of 2008 was $9.1 million, or $0.24 per
diluted share, an increase of $3.2 million, or 55%, from $5.9 million, or $0.15
per diluted share, for the comparable period in 2007. Net income for the first nine
months of 2008 was $21.5 million, or $0.56 per diluted share, an increase of $3.8
million, or 21%, from $17.7 million, or $0.46 per diluted share, for the comparable
period in 2007.
For complete details on VASCO’s latest performance visit CardData (www.carddata.com)

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