627 Million Shoppers are Online Worldwide

According to a recent AC Nielsen survey, more than 627 million people
have shopped online. Over 135 million consumers
have purchased DVDs, with another nearly 135 million making plane
reservations via the Internet. Europe and North America have the
highest incidence of online shoppers, with Germany, Austria and the UK
topping the list, with at least 95% of Internet users having
purchased online. Germany and UK averaged seven and six purchases
respectively in the past month. In Asia Pacific, South Korea and
Taiwan rank highest, with at least 90% of respondents claiming to
have ever made a purchase online. Latin America registers the lowest
past month purchase, with an average of only three purchases. ACNielsen
is a marketing information provider, offering services in more than 100
markets.

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Hypercom Optimum M2100 Now Available

Hypercom announced that the “Optimum M2100” card payment terminal for merchants and service providers in Europe, the Middle East and Africa is now available. The “M2100” is an always-on, battery-operated,
easy-to-carry terminal that accepts both magnetic stripe and smart
cards. It offers a full range of wireless connectivity options, EMV and
Visa PED security certifications, long battery life, and the ability to
withstand outdoor as well as indoor use. The compact handheld wireless
high-speed device offers fast, secure, mobile point-of-sale transaction
functionality for restaurants, delivery services, car rental companies,
sports stadiums, medical facilities, kiosks and other businesses that
require non-stationary payment systems.

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Chase Card Profits Up 29% Despite Losse

J.P. Morgan Chase reported this morning that credit card profits for the third quarter rose 29% to $541 million while revenues increased 6% to $4.0 billion, compared to one-year ago. However, operating earnings were impacted by a $100 million special provision for Hurricane Katrina credit losses and an additional $100 million provision for credit losses related to increased bankruptcies. Managed card loans of $137.6 billion were up 5% year-on-year, but flat sequentially. Pre-tax income to average managed loans (ROO) was 2.48% for 3Q/05, compared to 2.56% in 2Q/05 and 2.05% for 3Q/04. Excluding the special charge related to Hurricane Katrina, the ROO would have been 2.77%. During the third quarter, Chase opened about three million net new credit card accounts, ending the quarter with 98.2 million cards in-force. Charge volume for 3Q/05 was $76.4 billion, compared to $73.3 billion one-year ago. The managed net charge-off rate for the quarter declined to 4.70%, down from 4.88% in the prior year and 4.87% in the prior quarter. The 30-day managed delinquency rate was 3.39%, down from 3.81% in the prior year but up seasonally from 3.34% in the prior quarter. The 90-day managed delinquency ratio was 1.55%, up slightly from 1.54% in the second quarter. Bank card volume for Chase’s merchant acquiring business was $143.4 billion with 4.9 billion transactions. Chase also reported that it ended the third quarter with 9.1 million debit cards. For complete details on Chase’s third quarter performance, visit CardData ([www.carddata.com][1]).

JPM CHASE HISTORICAL ($billions)
3Q/04 4Q/04 1Q/05 2Q/05 3Q/05
EOP Outstandings: $131.5 135.4 133.4 137.3 137.6
Charge Volume: $ 73.3 75.3 70.3 75.6 76.4
Source: CardData (www.carddata.com)

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

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CO-OP Network Opens a Southeast Region Offc

The CO-OP Network has hired Lynn Kneebone, formerly with First Data and Certegy, as its Southeast Region Business Development Manager and has opened a Sarasota sales office. During her industry tenure, Kneebone accumulated experience in electronic commerce and payment services at First Data Corporation and most recently was Regional Vice President at Certegy Inc., working closely with credit unions in the EFT space. CO-OP Network is wholly-owned by its credit union shareholders and provides volume discounts on products and services that include risk management as well as debit and deposit access.

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HDFC Launches the Powerplus BusinessCard for SMEs

Mumbai-based HDFC Bank has launched a new credit card for small and
medium sized businesses. The new “HDFC Bank Powerplus BusinessCard”
offers a total credit limit of Rs 25 lakh which may be set at Rs 5 lakh
for each employee. The interest rate on balances is 1.5% monthly. The card
also features a number of reporting options. HDFC is targeting SMEs that
have been in business for at least three years.

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VISA Approves STM/OTI Contactless Solution

STMicroelectronics and On Track Innovations announced that their contactless solution is the first solution approved by VISA International for use in its “VISA Contactless” program in the USA. STMicroelectronics will supply the contactless microcontroller and has partnered with OTI to provide the operating system and application, the contactless card technology including the inlay technology. OTI designs, develops and markets secure contactless microprocessor-based smart card technology. STMicroelectronics develops semiconductor solutions across the spectrum of microelectronics applications.

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First Cash to be Acquired by Relay Capital

First Cash Card is being acquired by U.S.-based Relay Capital. First Cash has processed close to $1 million in transactions over
the last few months. Relay Capital is a developer and
marketer of a wide range of prepaid financial services. The “First Cash
Card” can be used at over 5 million ATM machines and over 1 million POS
terminals worldwide. Its principle growth has been in the check cashing
industry where employees can obtain a “First Cash Card” at no charge.
First Cash Cards allows $2,500 in ATM daily withdrawals and $2,500 in
POS transactions. Cards can also be used to purchase goods and services
over the Internet. First Cash Card provides debit cards to the
unbanked and underbanked.

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MasterCard Offers Webcast for Debit Issuers

MasterCard is launching a live thought leadership series delivered via webcasts next month. The first “Executive Insights” series will focus on retail banking and maximizing the debit opportunity. The first event is titled, “The Power of Insight: Knowing Your Customers, Growing Your Business,” and features Dr. Ken Dychtwald, president and CEO of Age Wave, a think tank on the boomer generation. MasterCard says the event will provide debit card issuers with insights into the role electronic payments play in developing a deeper understanding of their consumers, whether they are “Baby Boomers,” “Mass Affluent,” or “Small Business” decision-makers and how this knowledge is vital in acquiring, retaining and growing valuable customer relationships. The first webcast is scheduled for Wednesday, November 9th at 12 noon EST.

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Kamco Plans to Sell its Stake in Hyundai Card

Korea Asset Management Corporation has indicated it plans to sell its entire stake in Hyundai Card next week. Kamco owns about 9%
of the issuer and is the second-largest shareholder. Hyundai Motor Group is the largest shareholder. In August, GE Consumer Finance signed an agreement to acquire a 43% stake in Hyundai Card through a purchase of shares valued at $305 million, and participate in a rights issue in the amount of $162 million. In addition, GE will purchase subordinated debt in the amount of $196 million, bringing its total investment in Hyundai Card to $663 million. In August 2004, GECF purchased an initial 38% stake in Hyundai Capital Services, forming a joint venture under which the two companies have been providing a variety of financial services products to Korean consumers, including auto financing and personal loans. Hyundai Card, is the third largest credit card company in Korea, with 3.4 million members and assets of more than $2.8 billion.

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CitiDirect Card Management System Upgraded

Citigroup’s Global Transaction Services has upgraded its “CitiDirect Card Management System” to support more than 10 languages and to provide access to consolidated transaction data from 14 countries, as well as integrated cross-border card program support. The system is used by corporations to manage their card programs, enabling them to review, reconcile, split and reallocate transactions; create and modify accounts; set up or change controls for individual cardholders and review and approve cardholder statements. It provides a single, consistent interface in all of the countries where it is available. The advanced system was developed by Citigroup to meet the increasingly global demands of corporations using its purchasing and T&E cards, as well as their need for tighter control over their card programs.

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OBERTHUR 3Q/05

Oberthur Card Systems reported its best third quarter ever as revenues
climbed nearly 16% to 124.5 million euros, driven by a 31% increase in
the shipment of smart cards. Sales of payment smart cards were 30.1
million euros in 3Q/05, a 7% decline over the year-ago quarter when
sales were up sharply. During the quarter Oberthur shipped 47 million
smart cards. Sales of “Other Cards,” including magnetic stripe cards,
scratch cards and memory cards, were very dynamic driven by increased
U.S. sales. “Other Cards” sales rose 18% to 18.7 million euros.
Microprocessor or smart cards account for nearly two thirds of
Oberthur’s total revenues. The EMEA region contributed about 71% of the
card manufacturer’s total sales during the third quarter. Oberthur says
the payment market, which represents 57% of sales as of September 30th,
should remain the major engine for growth for the company in the years
to come as a result of the EMV migration. For complete details on
Oberthur’s third quarter performance, visit CardData (www.carddata.com).

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TSYS Q3 Revenues Climb 38%; Profits Up 23%

TSYS reported that third quarter profits rose 23% year-on-year to $48 million, but $2.5 million below the second quarter. Revenues hit a record $422 million, a 38% rise over 3Q/04. Accounts on file increased to 430.1 million as of September 30th, up 36% from one-year ago. TSYS also reports that stored value accounts rose by 500,000 accounts from the prior quarter, ending at 13.7 million. During the third quarter, TSYS converted the account portfolio of JPM Chase and signed an agreement to process Capital One’s credit card accounts. Also, TSYS’ Vital Processing Services subsidiary renewed its service agreement with Bank of America. Internationally, TSYS renewed agreements with C&A Modas in Mexico Allied Irish Bank and announced an agreement with Sonae Distribuicao of Portugal to provide gift card services. TSYS says it believes it is on target to be at the higher-end of its earnings projection for 2005 of 25%-28%. For complete details on TSYS third quarter performance, visit CardData ([www.carddata.com][1]).

TSYS REVENUE HISTORICAL
3Q/04: $305.0 million
4Q/04: $307.2 million
1Q/05: $350.0 million
2Q/05: $410.2 million
3Q/05: $422.0 million
Source: CardData (www.carddata.com)

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

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