GECF Profits Rise 21% in 4Q/05

GE reported that profit for its Consumer Finance unit climbed 21% in the fourth quarter to $770 million as GECF produced revenues of $4.9 billion, a 13.5% increase over 4Q/04. During the quarter, GECF acquired a majority interest in Keppel Bank, the oldest savings bank in the Philippines; made a strategic investment in Shenzhen Development Bank, China’s first publicly traded bank; reached an agreement to acquire Pacific Retail Finance, a $350 million consumer finance company in New Zealand, and one of the country’s largest direct-to-consumer finance operations; agreed to purchase the credit card assets of Belk, Inc., the United States’ largest privately owned department store company; and closed the acquisition of a stake in Garanti bank. For complete details on GE’s fourth quarter performance, visit CardData (www.carddata.com).

GE CONSUMER FINANCIAL TRACK RECORD
Income Revenues
4Q/04: $637 million $4304 million
1Q/05: $735 million $4689 million
2Q/05: $735 million $4928 million
3Q/05: $810 million $4913 million
4Q/05: $770 million $4886 million
Source: CardData (www.carddata.com)

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Grand Casino Brussels Signs Agreement with Global

Casinos Austria International’s Grand Casino Brussels has
signed a multi-year agreement to use the products and services of Global
Cash Access. Grand Casino Brussels will use GCA’s
QuikCash cash advance terminals, which are customer-activated, touch
screen terminals that provide casino patrons with point-of-sale
debit card and credit card cash advance transaction options. Available
in kiosk, countertop, wall-mount, free-standing and handheld models,
QuikCash cash advance terminals can be installed virtually anywhere
in a gaming establishment. Global Cash Access is a leading provider of
cash access products and related services to approximately 960 gaming
properties and other clients in the United States, Continental Europe,
the United Kingdom, Canada and the Caribbean.

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Cap One U.S. Card Profit Up 17% Y/Y

Capital One’s fourth quarter U.S. credit card profits increased 17% year-over-year but were cut in half sequentially due to the October bankruptcy surge and increased marketing expenses. U.S. managed card outstandings increased 7% from the third quarter but were up less than 2% from the year-ago quarter. U.S. card net income was $237.0 million, compared to $481.8 million in the prior quarter and $201.9 million for 4Q/04. U.S. managed card outstandings were $49.5 billion for 4Q/05 compared to $48.6 billion one-year ago and $46.3 billion in the previous quarter. Capital One also began disclosing volume figures with the fourth quarter. Purchase volume in the U.S. was up 19% to $21.2 billion. The managed delinquency rate (30+ days) for U.S. credit cards was 3.44% for the fourth quarter, compared to 3.86% for 3Q/05 and 3.97% for the fourth quarter of 2004. The net charge-off rate for U.S. credit cards was 5.70% for the fourth quarter, compared to 4.69% for the third quarter and 4.93% one-year ago. For complete details on Capital One’s fourth quarter performance, visit CardData ([www.carddata.com][1]).

COF U.S. CARD NET INCOME
4Q/04: $201.9 million
1Q/05: $458.2 million
2Q/05: $432.4 million
3Q/05: $481.8 million
4Q/05: $237.0 million
Source: CardData (www.carddata.com)

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

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Benny MasterCard Offers FSA Grace Period

Connecticut-based Evolution Benefits has successfully automated the features of the new “IRS Flexible Spending Account” grace period provision into its “Benny MasterCard” debit card system. In May 2005, the U.S. Treasury and IRS reduced the risk of the use-it-or-lose-it rule for Flexible Spending Account participants by allowing a grace period of two and one-half months after a cafeteria plan year ends to incur and apply expenses against the prior year’s available funds. Generally, card vendors do not offer an automated solution to the grace period. As a result, cardholders have to submit a manual claim to get reimbursed for qualified FSA expenses incurred during the grace period being applied to their prior year’s funds. Evolution Benefits now provides the benefits programs of more than 80 managed care and administrative services organizations.

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JCB Smart Card Launches in Korea

South Korea’s Chohung Bank has introduced the “Chohung 365 BC JCB Card” EMV card. This is the first full-scale launch of a JCB smart card in Korea, according to this week’s CardFlash International. The new card offers “BC” miles redeemable for tickets on all airlines in Korea, the “Korea Train eXpress” mileage program and the “OK cashback” program, which is a major loyalty program affiliated with many national chain stores. A significant advantage is that “Chohung 365 BC JCB” cardholders can choose to have the “T-money” function incorporated into the IC chip, which enables them to use a postpaid “T-money” service on subways and buses in Seoul and other local districts. “T-money” function can also be used to pay admission at amusement parks and other spectator facilities, as well as parking fees. Other benefits include discounts offered at nationwide SK gas stations, major cinemas, hotel discounts of 20 to 50% off, and airline discounts from 5 to 7% off, while purchases of foreign currency receive a 30% discount on the exchange commission at Chohung Bank.

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Citi’s Willumstad Joins the AIG Board

Robert Willumstad, the recently retired President and COO of Citigroup, has joined the Board of Directors of AIG. Willumstad, 60, was a member of the Citigroup Management and Business Heads Committee and of the Citigroup Board of Directors. Previously, Willumstad served as Chairman and Chief Executive Officer of the Global Consumer Group at Citigroup, with responsibility for all of Citigroup’s global consumer businesses, including credit cards, consumer finance and retail banking. Willumstad previously was Vice Chairman of the Global Consumer Group and led Citigroup’s Global Consumer Lending shortly after the merger of Citicorp and Travelers Group in 1998. He is a member of the Board of Directors of Mastercard International. American International Group, Inc. (AIG) is a provider of insurance and financial services.

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Ingenico and TPI Software Partner

Ingenico has partnered with TPI Software to address the payment acceptance needs of mid-sized and smaller retailers that need a low cost PC payment processing software solution. SmartPayments can be used as a non-integrated stand beside solution or integrated with most POS systems, including Microsoft’s new RMS POS software to provide a complete payment and inventory management software. TPI also supports credit card electronic signature capture retrieval with the Ingenico eN-Touch 1000, i6550 and i6770 payment terminals. TPI Software is a provider of payment technologies.

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GECF Profits Rise 21% in 4Q/05

GE reported that profit for its Consumer Finance unit climbed 21% in
the fourth quarter to $770 million as GECF produced revenues of $4.9
billion, a 13.5% increase over 4Q/04. During the quarter, GECF acquired
a majority interest in Keppel Bank, the oldest savings bank in the
Philippines; made a strategic investment in Shenzhen Development Bank,
China’s first publicly traded bank; reached an agreement to acquire Pacific
Retail Finance, a $350 million consumer finance company in New Zealand,
and one of the country’s largest direct to consumer finance operations;
agreed to purchase the credit card assets of Belk, Inc., the United
States’ largest privately owned department store company; and closed the
acquisition of a stake in Garanti bank. For complete details on GE’s
fourth quarter performance, visit CardData (www.carddata.com).

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Late Fees Rise 6% in 2005

Late fees on credit cards increased nearly 6% during 2005 to more than $34 with $39 emerging as the most common fee. Over the past five years late payment fees have jumped by more than 27%, according to CardTrak (www.cardtrak.com). In 1995, the average fee was $13.24 compared to $34.42 today. Most top issuers now charge punitive interest rates around 30%. Citibank’s interest rate charged to delinquent and risky cardholders is now at 31.24%.

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