SCOTIABANK BERKLEY VISA

Scotiabank has partnered with Berkeley Payment Solutions to introduce
its suite of prepaid corporate Visa cards to the Canadian market. The
new suite of payment solutions feature branded, re-loadable
prepaid Visa cards, providing the ease-of-use of a credit card with the
appeal of cash with a reward option redeemable anyway,anywhere. Nissan
Canada has selected the 2 organizations to spearhead the “Nissan Rogue
Test Drive Direct-mail” reward program, providing participants with a
Nissan prepaid Visa card, and the “Bonus Days” program in December 2007,
offering customers a choice of a Nissan-branded prepaid Visa gift card
or a rebate upon the purchase of one of four Nissan vehicles.
Additionally, Scotiabank and Berkeley also worked with LG Electronics
Canada for the launch of the “LG Shine” cell phone in October 2007 as
part of its “Born to Shine” campaign.

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RISING DEFAULTS

Standard & Poor’s credit rating agency has released figures showing
credit card and mortgage delinquencies are continuing to rise for 1Q/08,
especially among subprime mortgages bundled into securities rated
between 2005 and 2007 with a default rate of 21.73%. Subprime mortgage
defaults were up from 19.41% in 4Q/07 while prime mortgage
delinquencies, however, rose to 2.41% in 1Q/08 and were up from 2.11% in
4Q/07. Meanwhile, credit card delinquencies rose to 5.88%, up from 5.6%,
while charge-offs rose to 6.51% in March, up from 6.17% in December.

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Emerald Prepaid MasterCard Goes Mobile

H&R Block Emerald Prepaid MasterCard cardholders will have access to mobile phone text messaging to check their balances and receive account reload mobile alerts. This tax season, H&R Block issued 2.6 million cards. H&R Block customers continued to use the cards for purposes beyond receiving their tax refund, loading payroll direct deposit and other funds on the card. In addition to text message balance inquiry, the Emerald Card offers clients payroll direct deposit; connection to line of credit;access to a savings account; link to money transfer services and nationwide ATM access and point-of-sale purchasing wherever MasterCard debit cards are accepted. H&R Block will start piloting the text messaging capabilities made available by Metavante Mobile Financial Services, powered by Monitise Americas technology.

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SCM & SONY

SCM Microsystems has signed a memorandum of understanding with Sony to
develop and supply FeliCa contactless card readers targeting
international enterprise, mobile and banking markets. The product
portfolio will consist of FeliCa “Physical Access Control Terminals”
(PACT) and SCM terminals/readers developed under the cooperation,
anticipated for introduction by 4Q/08. FeliCa was created by Sony and is
based on radio frequency identification (RFID) technology allowing for
contactless transactions over an environment-friendly solution. SCM
Microsystems provides Digital World contact and contactless smart card
reader technology for the transfer of digital content while the Sony
Corporation provides device and information technology products for the
consumer market, professional market, and had sales of approximately $88
billion in 2007.

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Verrus Pay by Phone Hits Miami Parking

The City of Miami Parking Authority is now offering the Vancouver-based”Verrus Pay by Phone” service for 8,000 street spaces and 20 parking lots. To use the service, motorists must first register their mobile phone number, tag number and Visa/MasterCard number with the Verrus service. Once signed up with a free pay by phone account, users simply call the toll-free number from the registered phone and key in the location number (posted on the meter or on nearby signs) and the amount of parking time desired. The appropriate total, plus a 35-cent service charge (including the text message reminder cost), will be charged to the credit card. A transaction history is then viewable any time the user logs into his or her account at http://www.paybyphone.com . When paying by phone, motorists may also select the option to receive a text message reminder a few minutes before their time expires and add more time remotely – no more hurried trips to the vehicle to feed the meter.

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NCR & HDFC

HDFC Bank has renewed its “Managed Services” contract with NCR regarding the management of its 2,000 ATMs, expanding on the previous 3-year contract, and has additionally placed an order for 300 new ATMs. The additional ATMs are part of HDFC Bank’s expansion strategy throughout India while the NCR customized “Managed Services” solution will provide its customers with incident management, cash management, first-line maintenance, second-line maintenance and higher ATM availability. HDFC Bank was incorporated in August 1994, has over 754 branches spread over 327 cities across India and a network of over 1,900 networked ATMs while the NCR provides assisted- and self-service solutions for organizations in over 100 countries.

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Credit Union Portfolio Sales Drop in Q1

BROOKWOOD CAPITAL has completed its research on credit union credit card portfolio sales activity for the first quarter of 2008. In total, 10 credit unions with credit card portfolios of over $1 million in outstanding balances sold their portfolios in the first quarter. Total balances sold during the quarter were approximately $62 million. On average, the size of the portfolios sold was $6.2 million.

For the first time, Brookwood has also tracked the number of credit unions that have begun issuing cards themselves, either for the first time or after termination of an agent issuing agreement following a prior portfolio sale. In the first quarter one credit union emerged as a new credit card issuer (defined as growing to more than $1 million in receivables) during the quarter.

Brookwood Capital specializes in assisting credit unions in the financial analysis and strategic review necessary to properly consider these decisions.

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BUSINESS MONITOR

According to the CICA/RBC quarterly Business Monitor, corporate optimism
plummeted in 1Q/08 across Canada in regards to the 12-month economic
outlook according to the participants of the CICA/RBC Business Monitor.
Among the participants, 24% of CAs in executive corporate positions are
optimistic in regards to economy for the coming year, compared to 63% in
4Q/07, while 48% of national businesses are optimistic in regards to the
same compared to 57% 4Q/07. Optimism also declined in the business
outlook for specific regions of Canada, having dropped 18% to 49% in
B.C., dropped 16% to 39% in Ontario and is up 9% to 60% in Alberta.
There is, however, a positive hiring outlook for post-secondary grads
with a projected .5% increase. The CICA/RBC Business Monitor is issued
quarterly based on surveys conducted by The Canadian Institute of
Chartered Accountants (CICA).

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How to Segment Rewards Program Members

Aite Group has released two new reports titled,”Segmenting Rewards Program Members” which examines consumers’ relationships and involvement with rewards programs which reveals each segment’s level of program enrollment and activity, as well as insight into their levels of satisfaction with rewards programs. The report suggests ways to increase satisfaction, enrollment and activity across each of the segments and “Mistakes Banks Make When Serving Small Businesses” which identifies three common mistakes banks make when serving the small-business customer segment which include underestimating the willingness of small businesses to use more advanced online capabilities; failing to provide the right tools for small businesses to manage their cash; and offering only limited small-business product portfolios.

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PAYPAL IRELAND

PayPal has announced its intention to expand its Dublin Operations
Center, moving it to the Ballycoolin Business Park in Blanchardstown
before 4Q/08, in response to exponential growth in European operations.
In doing so, the new facilities will support 1250 employees, 350 more
than that of the Dublin Operations Center, and support future growth
across the region. Paypal selected Dublin for its talented, experienced
work force in the technical and financial services industry and decided
on the new office location with the assistance of HT Meager O’Reilly
Real Estate and Property Consultancy. PayPal provides consumers with
secure online payment solutions, has more than 60 million active
accounts in 190 markets and 17 currencies around the world.

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Loyalty Card Rewards Provide Stimulus

A new report says American consumers hold 1.3 billion memberships in loyalty card reward programs, rendering many capable of reclaiming lost financial ground with the combination of their economic stimulus check, card rewards, points, miles and cash back offerings in the face of escalating gasoline and grocery prices, which are up approximately 75 cents and 5% respectively. Additional research compiled by COLLOQUY shows the average household belongs to 12 reward programs, 5-4 of which are actively participated, while U.S. consumers hold 254 million memberships in airline frequent flyer programs. Furthermore, U.S. consumers hold 238 million memberships in credit card reward programs, 137 million memberships in specialty retail reward programs, 124 million memberships in grocery reward programs, 107 million memberships in department store reward programs and approximately 130 million U.S. households will or already have received stimulus payments from the U.S. government.

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Chase Renews the Disney Rewards Visa

Disney Credit Card Services and Chase Card Services have inked a deal to renew their co-brand card agreement for the “Disney Rewards Visa Card.” The Disney co-brand has signed up more than two million cardholders since its launch in 2003. The card offers cardholders “Disney Dream Reward Dollars” on all purchases, which can be redeemed for most everything Disney – from resort stays and theme park tickets to Disney DVDs, toys and movie tickets at participating theaters. Cardholders can begin redeeming with just 20 “Reward Dollars.” The card also offers special financing on select Walt Disney Travel Company vacation packages and all “Disney Cruise Line” and “Adventures by Disney” vacations booked directly with Disney or a travel agent.

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