Chase Credit Card Loans Climbs 5%; Volume Up 9%

J.P. Morgan Chase reported this morning that credit card profits for the fourth quarter were $515 million on revenues of $3.83 billion. Managed card loans of $135.4 billion were up 5% year-on-year, and up 3% sequentially. During the fourth quarter, Chase added 2.73 million net new credit card accounts, ending the quarter with 94.3 million cards in-force. Charge volume for the fourth quarter was $75.3 billion, compared to $69.1 billion one-year ago. The managed net charge-off ratio for the quarter declined to 5.24%, from 5.48% in the prior year, and increased from 4.88% in the prior quarter due to seasonally higher losses. The 30-day managed delinquency ratio was 3.70%, down from 4.21% in the prior year, and 3.81% in the prior quarter due to improved credit quality. Bank card volume for Chase’s merchant acquiring business was $135.9 billion with 4.5 billion transactions. Chase also reported that it ended the quarter with 8,392,000 debit cards. For complete details on Chase’s fourth quarter performance, visit CardData ([www.carddata.com][1]).

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

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Lynk Systems Changes its Name to RBS Lynk

Atlanta-based Lynk Systems has changed its company name to RBS Lynk Incorporated, following its acquisition by The Royal Bank of Scotland Group. RBS is a significant force in the payments industry in Europe and plans to leverage its expertise to win new national accounts for RBS Lynk in the U.S. market. As part of the RBS Group’s U.S. holdings, RBS Lynk will report up through the Citizens Financial Group as part of a newly created division called Retail Direct, USA, focused entirely on the payment processing industry. RBS Lynk is a single-source provider of electronic payment processing services (including credit, debit, EBT, gift cards, customer loyalty cards, checks and more).

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SKY PEARL MASTERCARDS

China Southern Airlines is giving credit cards to all EMBA students enrolled in the Tsinghua Management College at Tsinghua University. The “Sky Pearl Club Gold MasterCard” arrangement is part of a broader deal signed between China Southern and Tsinghua. Currently, Tsinghua has over 20,000 students, including 12,000 undergraduates, 6,200 master’s degrees candidates and 2,800 doctoral candidates.
China Southern Airlines is the largest airline in The People’s Republic of China connecting to more than 80 cities around the globe.

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TSYS Net Income Rises 9%; Accounts Up 27%

TSYS reported fourth quarter net income of $39.4 million, a 9% rise over the year-ago quarter. Revenues topped $307 million, a nearly 13% rise over 4Q/03. Accounts on file increased to 344.2 million, up 27%, compared to 271.7 million one-year ago. During the fourth quarter, TSYS completed the conversion of the Bank One portfolio, signed contract extensions with MBNA and First Tennessee, received a patent for TSYS “ProphIT,” its proprietary front-end workflow management system, and introduced new Internet-based “Credit Care” products in Europe. The processor says it anticipates 30% to 33% growth in revenue for 2005, and expects accounts on file to reach 425 million by year end. For complete details on TSYS’ latest performance, visit CardData ([www.carddata.com][1]).

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

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ReD Beefs-Up ebitGuard to Fight CNP Fraud

NJ-based Retail Decisions has added two product enhancements for its fraud prevention service, “ebitGuard.” The enhancements will provide mass retailers in the card-not-present space access to neural technology to fight fraud. ReD’s “PRISM” neural technology and “Dynamic Data Validation” is being added to “ebitGuard.” “PRISM” is able to detect abnormal cardholder behavior, distinguish subtle differences manifested by fraudulent orders compared to superficially similar valid orders. Simultaneously, “PRISM” incrementally learns new purchasing behavior or pattern changes adapting its model and intelligence resulting in a dynamic system that detects emerging fraud schemes. “Dynamic Data Validation” matches a consumer’s billing and shipping information with multiple public records. Additionally, “Dynamic Data Validation” is able to find additional profitable sales opportunities in AVS and CVV failures.

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OTI Closes InterCard Kartensysteme Deal

Keycorp Limited and Thales e-Transactions announced the signing of a MOU for future cooperation. The two companies aim to leverage their
complementary strengths in development, manufacture and sale of highly
secure payment systems. The first milestone in the agreement is for Keycorp to distribute and install Thales “Artema” payment terminals for specific opportunities in its markets. The second milestone will be the conclusion of a broader agreement covering close technical, sales and marketing cooperation for the development of future terminal products. This would involve Keycorp becoming the “Centre of Excellence” for software architecture, with Thales managing the development of hardware and system software.

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Precise Biometrics Acquires Fyrplus Teknik

Precise Biometrics has acquired 100% of the shares in
the Swedish IT consultancy Fyrplus Teknik. The purchase price totals SEK 5-7 million, partly conditional on future profits. The Company will
gain access to sales revenues of about SEK 20 million and
will, after the acquisition, be nearly twice as large as a group, with 60 employees. Fyrplus Teknik has extensive experience in multi-biometric projects from areas such as the travel industry, the pharmaceuticals industry and the healthcare sector, predominantly in Scandinavia.

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VISA Europe Sets a Record on Dec. 24th

VISA Europe reported that December 24th was the busiest ever hour in terms of transactions through their processing system.
On Friday, 24 December 2004, between 1400 and 1500, there were, on
average, 880 transactions going through the Visa processing center every
second. A total of 3,168,000 transactions in that hour alone. VISA Europe can process over 1,200 transactions per second.

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Alberta Cardholders Lead in Average Balances

Canadians now carry an average credit card balance of C$2,451 per person, according to a January survey. Cardholders in Alberta carry the highest average balance, C$2,935, while consumers in British Columbia carry the lowest average balance of C$2,075. The new BMO Bank of Montreal survey also found that Canadians spent approximately $970 each during the holidays (on gifts and other related expenditures) with most the of spending placed on payment cards. BMO says the survey showed that of those who carry a balance, 24% expect to take six months or more to pay off holiday card debt. The BMO Bank of Montreal “Post Christmas” survey was conducted by Decima Research.

AVERAGE CREDIT CARD BALANCES
REGION AVERAGE BALANCE
Alberta $2,935
Saskatchewan/Manitoba $2,762
Ontario $2,526
Quebec $2,242
British Columbia $2,075

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Keycorp and Thales e-Transactions Partner

Keycorp Limited and Thales e-Transactions announced the signing of a MOU for future cooperation. The two companies aim to leverage their
complementary strengths in development, manufacture and sale of highly
secure payment systems. The first milestone in the agreement is for Keycorp to distribute and install Thales “Artema” payment terminals for specific opportunities in its markets. The second milestone will be the conclusion of a broader agreement covering close technical, sales and marketing cooperation for the development of future terminal products. This would involve Keycorp becoming the “Centre of Excellence” for software architecture, with Thales managing the development of hardware and system software.

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Cofinoga Names Diebold as Exclusive ATM Provider

Cofinoga Group, a primary grantor of credit to department store
customers across Europe, has appointed Diebold as the exclusive provider of its off-premises ATMs. The “Opteva” ATMs are powered by “Agilis,” Diebold’s open, high-performance software, which is capable of interfacing with a variety of multiple-vendor products, reducing the need for back-end support. The first of the ATMs, placed in Cofinoga’s commercial partners’ store locations, have been installed. Dozens of additional orders are expected to be formalized early in 2005. The agreement includes both Diebold ATMs and maintenance services.

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TSYS Buys VISA’s Stake in Vital Processing

TSYS has inked an agreement to purchase the 50% equity stake that VISA USA holds in Vital Processing Services. Vital is the second-largest processor of merchant accounts in the USA, serving more than one million merchant locations. The company was formed in 1996 as a joint venture between VISA and TSYS. Vital will now become a wholly-owned subsidiary of TSYS after the deal closes this quarter. Beverly Wells will remain the president, a position she has held since 2003. TSYS projects that Vital will add between $225 million and $235 million to its annual revenue.

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