CSCU to Distribute a Visa IPO Dividend

Card Services for Credit Unions will distribute a “special mid-year Visa IPO patronage dividend distribution” of $28.9 million to approximately 2600 member credit unions from across the country. This distribution represents 100% of what CSCU received from the Visa IPO. CSCU’s interest in Visa was based on fees paid on volume from the inception of Visa in 1975 through December 2005. Accordingly, CSCU will base its distributions on volume from the inception of CSCU in 1989 through December 2005. CSCU is the nation’s largest credit and debit card processing association exclusively for credit unions with more than 3,300 member credit unions representing more than 13 million Visa and MasterCard accounts.

Details

GE MONEY & SANTANDER

GE Money and Commercial Finance have signed definitive agreements with
Banco Santander for a combined transaction volume of EUR1 billion. These
agreements stipulate Banco Santander will acquire GE Money’s businesses
in Germany, Finland and Austria, Ireland and its card and auto
businesses in the UK while GE Commercial Finance will acquire Interbanca
Italian commercial bank from Santander. These developments are subject
to the receipt of certain regulatory approvals and anticipated to close
early in 4Q/08.

Details

Serverside Group Targets Smaller Issuers

A London-based specialist in online card design is now targeting credit unions and smaller issuers for card customization programs. Serverside Group says its flagship “AllAboutMe” online card designer is very cost-effective. The entry-level online card designer, which blends seamlessly with a credit union’s website, is the culmination of Serverside’s understanding of best practices and five years’ experience in the card customization sector. To date, Serverside has launched more than 350 card programs globally through over 65 clients and 74 issuers. Serverside’s credit union clients include Wescom and America First. The Company also has a strategic alliance with Datacard Group.

Details

U.S. Delinquency Up 76 BPS from 1Q/07

Credit card delinquency among U.S. issuers climbed 41 basis points in the first quarter and is now up 76 basis points from the year ago quarter. According to CardData, delinquency reached 5.42% in the first quarter, compared to 5.01% in the fourth quarter and 4.66% for the one-year ago. Chase reported its 30-day managed delinquency rate was 3.66% for the first quarter, up from 3.07% in the prior year and 3.48% in the prior quarter. BofA also reported its managed 30+ day delinquency rose to 5.93%, compared to 5.70% in the fourth quarter and 5.45% for 1Q/07. Additionally, Capital One posted a managed delinquency rate (30+ days) for U.S. credit cards of 4.04% for the first quarter, compared to 4.28% for 4Q/07 and 3.06% for the first quarter of 2007. (CF Library 4/16/08; 4/18/08; 4/21/08)

U.S. Card Delinquency
1Q/07: 4.66%
2Q/07: 4.62%
3Q/07: 4.74%
4Q/07: 5.01%
1Q/08: 5.42%
Source: CardData (www.carddata.com)

Details

U.K. Charge-Offs Hits 6.6% in 1Q/08

Charge-offs among credit card-backed bonds in the U.K. headed north during the first quarter hitting 6.6%, compared 6.3% in fourth quarter and delinquency increased 20 basis points from the prior quarter, reaching 3.6% in March, its highest recorded value for the last nine months. However, the monthly payment rate and yield increased to provide mixed results for the first three months of this year. According to FitchRatings, the yield and the MPR both increased from Q4/07, to 20.5% and 17.3%, from 19.1% and 16.6% respectively. Excess spread also improved across all the series included in the Fitch Excess Spread Index , with only three series trapping excess spread in March 2008; the Fitch ESI values at the end of each quarter increased to 6% from 5.3%.

Details

Bankrate Analyzes Credit Card Rewards

Bankrate released its first annual analysis of credit card rewards compiled using the latest research into the cash-back reward offers on 30 credit cards to determine the values of each cash-back rewards offerings and to help consumers decide on the best card. The analysis concludes those who spend around $1000 or more per month on the card are best suited for tiered rewards cards, those who spend less should use a flat percentage reward card, all consumers should be wary of high-interest transaction incentive rewards and understanding personal shopping habits to avoid restrictions. It is also important for consumers to look for cards with no cap on how much cash you can earn back with $500 or greater being a fair figure, should look out for fees high enough to minimize/negate the cash-back rewards, stay within budget and, most importantly, read the fine print.

Details

Oberthur Technologies Promotes Hearn to VP

ID security provider Oberthur Technologies has promoted Patrick W. Hearn from director to vice president of Identity Markets for North & Central America. Hearn has been director of that division since 2004 and is responsible for physical and logical access products and services for federal and state agencies and corporate/VAR markets, as well as travel documents. Prior to joining Oberthur, Patrick held management positions in emerging security technologies at Thomson Corporation and Jane’s Information Group.

Details

Only 25% of Consumers Opt for Green Banking

Although most consumers expressed an interest in adopting green banking behaviors, three out of four consumers still receive paper statements. According to Javelin, if every U.S. household stopped receiving paper bills and statements, 687,000 tons of paper would be saved every year. Other key findings in Javelin’s “Green Banking Report”: 34% of consumers said they switched to electronic statements to reduce their impact on the environment; 43% of consumers said they are more likely to do business with companies they perceive to be green; 22% said green initiatives cement the bond they have with their bank; 60% of “green bankers,” or consumers who say environmental impact is “extremely important” in purchasing and banking decisions, are women; and 64% of “skeptics,” or consumers who say they are “very less likely” to be more loyal to their bank because of its environmental activities, are men.

Details

Consumer Reports Critiques Reward Programs

A new survey concludes that about 85% of U.S. households participate in at least one rewards program. However, the Consumer Reports research says finding real savings can be tough, and even the more generous programs have limits on how much consumers can earn. CU says some rewards cards do double duty as credit cards. Cash-back, gas, and grocery rewards credit cards can offer some relief for costly essential items, but often carry higher rates than traditional credit cards. Looking at some of the more generous credit card rewards programs, CR found that rates varied from 9.74% to as much as 19.99%. About 41% of the newsletter’s subscribers carried three to five such cards, 9% had six to nine of them, and 3% carried 10 or more.

Details

CreditCards.com Cites Rising Gas Costs

A poll commissioned by CreditCards.com indicates that 53% of Americans have cut back on driving to visit friends or family due to gasoline cost. More results indicate that the groups reporting the most cutbacks on family vacations are those earning $30,000 to $49,900 a year, young adults and those living in the South and Americans with lower household incomes (under $30,000) are more likely to say they are cutting down on their drive to work, compared to their higher income counterparts. Younger adults, ages 18 to 34 have cut back on driving to work more than any of their older counterparts and people living in the Northeast were least likely to say they have cut back on driving due to gas prices. CreditCards.com is for consumers wanting to learn more about credit cards, offering advice, news, features, statistics and tools all designed to help consumers make smart choices about credit cards.

Details

First Data to Continue Frontier Processing

First Data will continue to provide card processing for Frontier Airlines while the carrier continues to operate despite its recent bankruptcy filing. The agreement provides First Data with appropriate protection for continuing its processing work for customer credit card purchases on a “business as usual” basis. Frontier Airlines is the second-largest jet service carrier at Denver International Airport, employing approximately 6,000 aviation professionals.

Details

BOFA/HUIJIN

NC-based Bank of America has announced it will be exercising its option
to purchase further China Construction Bank (CCB) common shares under
the existing agreement with Huijin first signed in June of 2005. With
this, Bank of America intends to purchase 6 billion H-shares for
approximately HK$2.42 per share, bringing its holding in CCB to 10.75%,
a total of 25.1 billion H-shares, up from an 8.2% holding. Additional
terms of the agreement stipulate the shares can not be sold prior to
August 29, 2011 without prior consent of CCB while Bank of America has
the option to purchase additional shares. Bank of America provides over
59 million account holders service through its more than 6,100 retail
banking offices in more than 150 countries, nearly 18,500 ATMs and
online banking service with nearly 25 million active users.

Details