Mid-Size Credit Union Portfolios Decline 6% in 2003

A sampling of credit unions reporting fourth quarter results so far, show weak performance during 2003. The five mid-sized credit union portfolios, representing more than $500 million in card loans, produced an aggregate decline of 5.7% last year. Golden 1 Credit Union declined 23% to $121 million. Randolph Books credit union increased a mere 4.4%, according to CardData ([www.carddata.com][1]).

Issuer Outstandings Y/Y Change
America First CU $138,844,928 -1.7%
Golden 1 CU $121,011,380 -22.9%
Delta Employees CU $104,918,000 +1.9%
Randolph Brooks FCU $ 95,239,420 +4.4%
Travis FCU $ 79,073,426 -0.1%
TOTAL: $539,187,154 -5.7%
Source: CardData (www.carddata.com)

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

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Continental AirPlus Company Account Takes Off

Continental Airlines has teamed with AirPlus International to expand UATP travel payment options to corporate businesses. This new product combines the strengths of AirPlus’ full line of corporate travel tools and Continental’s highly effective sales and marketing team, which has produced impressive growth of the Continental UATP program in just more than three years as an Issuer. The original Continental UATP account and all the features that have made it a top selling corporate travel payment product will still be available to corporate customers. UATP is the world’s first corporate charge product. UATP accounts are actively issued by 14 member airlines and accepted as a form of payment for corporate business travel by more than 200 airlines worldwide.

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Fifth Third Renews Saks Contract for 3 Years

Saks has signed a three-year contract extension for credit card processing services from Fifth Third Bank Processing Solutions. Saks is operating 378 stores in 39 states with nearly $6 billion in annual revenue. Fifth Third Bank Processing Solutions processes 8.2 billion ATM and POS transactions per year for more than 197,000 retail locations and financial institutions worldwide, including The Kroger Co., AutoZone, Abercrombie & Fitch, Nordstrom, Inc. and The Finish Line. Fifth Third Bancorp is a diversified financial services company headquartered in Cincinnati, Ohio.

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NPC 4Q/03 Revenues Up 15%; Profits Up 5%

Louisville-based National Processing reported that net income for the fourth quarter was up 5% to $14.8 million. The Company reported revenue for the fourth quarter of $135.5 million, a 15% increase over one-year ago. Merchant Card Services processed 1.2 billion transactions for the quarter, an increase of 16%. Merchant Card Services dollar volume processed was $51.7 billion for the quarter, a 14% gain. For the full year 2003, Merchant Card Services processed $177.2 billion and 4.3 billion transactions, an 11% and 5% gain, respectively. NPC notes the dollar volume processed has trailed transaction growth primarily as a result of the Company’s initiative to exit merchant processing for airlines, which have a large average ticket per transaction. The Company projects 2004 revenue to be in the range of $490 million to $520 million. For complete details on National Processing’s 4Q/03 performance visit CardData ([www.carddata.com][1]).

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

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Canadian December Card Retail Volume Up 9%

Despite predictions of retail sales growth in the range of 3% to 6%, Canadians racked up nearly 9% more in December retail sales compared to 2002. Based on more than 125 million debit and credit card transactions from more than 110,000 retail merchant locations spanning 162 retail categories, consumers spent $2.19 billion more at retail locations in December 2003 than they did the previous December. Card volume in discount stores rose 14% in December while department stores fell 8%. Pet stores posted the strongest year-over-year gain of 25%. Family clothing stores were up 9%, but children’s and infants’ clothing stores were down 6%. Performance in other categories showed: stationery stores up 13%; book stores up 12%; grocery stores up 12%; music stores up 7%; apparel (all apparel segments) up 4%; and, gift, card and novelty stores up 1%. The data were gathered by Moneris Solutions Corporation, Canada’s largest processor of debit and credit card transactions.

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NY Firefighters Gold MasterCard Fires Up

National City and the Uniformed Firefighters Association of Greater New York are launching an affinity “Gold MasterCard” this morning. This special edition credit card will be available to consumers across the country on January 15, 2004 and will benefit New York City firefighters’ families by contributing to the Uniformed Firefighters Association’s Widows’ and Children’s Fund based on purchases made using the card. The UFA credit card is a Gold MasterCard branded credit card, featuring no annual fee, no balance transfer fees and a competitive interest rate. In addition, the card will offer a variety of benefits such as online account access, merchant discount programs, automatic rental car insurance, purchase assurance program, $150,000 common carrier travel accident insurance, roadside assistance, and an extended warranty program. National City Corporation (NYSE: NCC), headquartered in Cleveland, Ohio, is one of the nation’s largest financial holding companies.

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Diebold Names New Communications Head

Diebold has promoted Jean Bailey to VP/Global Communications replacing Donald Eagon, who recently retired. Bailey joined Diebold in April 2003 as director of Internal Communications and previously served as director of Internal Communications at TRW Inc., located in Cleveland. Diebold, Incorporated is a global leader in providing integrated self-service delivery systems, security solutions and services. Diebold employs more than 13,000 associates with representation in more than 88 countries worldwide and is headquartered in North Canton, Ohio, USA.

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BofA Adds $3 Billion in Card Loans & 400K Accounts

Bank of America reported this morning that its credit card outstandings rose nearly $3 billion in the fourth quarter, producing a 24% increase over the one-year ago quarter. BofA says it added 414,000 new credit card accounts during the fourth quarter. For all of last year BofA opened 4.26 million new credit card accounts compared to 2.67 million in 2002. BofA says the account growth was driven by the development of more competitive offers, improved technology at the point of sale and an increase in direct mail marketing. For 2003, BofA notes that consumer credit and debit card purchase volumes increased 13% and 22%, respectively. Bof A reports that its card income increased 11% to $815 million. Managed credit card profits were $323 million for the fourth quarter, a 3% gain over 4Q/02. Total revenue for its managed credit card portfolio was $1.2 billion, a 3% gain over last year. At the end of the fourth quarter, BofA had $36.6 billion in managed credit card outstandings, a 24% increase over the year-ago quarter. Fourth quarter charge-offs were 5.12%, compared to 5.32% in the prior quarter, and 5.03% one year ago. Managed 30+ day delinquency was 3.93%, compared to 3.84% in the third quarter, and 3.94% for 4Q/02. Managed 90+ day delinquency was 1.77%, compared to 1.76% in the third quarter, and 1.71% for 4Q/02. For complete details on Bank of America’s 4Q/03 performance visit CardData ([www.carddata.com][1]).

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

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VCT and Jet Team to Promote Foil Cards

Versatile Card Technology and Jet LithoColor have teamed to promote, license and protect patents for production of foil laminated transaction cards. VCT’s Qualteq division owns patents for methods of making foil faced transaction cards having graphics and Jet LithoColor owns patents for the method of producing foil laminated cards with double-sided printing. As a globally recognized leader, and the world’s largest manufacturer of plastic cards, VCT produces cards for every application and offers complete fulfillment services and turnkey solutions. Recognized as a leader in the printing and production of plastic gift cards, commercial printed materials and related finishing and fulfillment services, Jet provides customized communication solutions to their customers throughout the Americas.

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AMEX & AEROPLAN

American Express has rolled-out three new co-branded charge cards following the finalization of its recent deal with Air Canada. The new “AeroplanPlus Card,” “AeroplanPlus Gold Card,” and, “AeroplanPlus Platinum Card” reward users with 1.0 mile to 1.5 miles for each dollar charged. “Aeroplan” also joined “Membership Rewards” as part of the agreement. Beginning, February 16th, cardholders enrolled in AmEx’s existing “Membership Rewards” points program will be able to convert their points earned on charge cards into “Aeroplan Miles,” on a one-for-one basis. The blue-colored AmEx “AeroplanPlus Card” earns one “Aeroplan Mile” for every dollar spent on purchases on the card and carries a $60 annual fee. The AmEX “AeroplanPlus Gold Card” earns one “Aeroplan Mile” for every dollar spent on purchases up to $10,000 annually and then 1.25 “Aeroplan Miles” per dollar in purchases over $10,000 each year. Charter members can earn as much as 1.35 “Aeroplan Miles” on annual purchases when they spend over $10,000. New cardholders are also eligible for an Air Canada companion ticket in 2004. The “Gold Card” has an annual fee of $120. The AmEx “AeroplanPlus Platinum Card” earns 1.25 “Aeroplan Miles” for every dollar spent on purchases up to $25,000, and 1.5 “Aeroplan Miles” on purchases thereafter each year. Charter members can earn as much as 1.6 “Aeroplan Miles” on annual purchases when they spend over $25,000. Additional benefits include an Air Canada companion ticket, Air Canada “Priority Check-In” and access to Maple Leaf and Arrivals lounges across Canada and in key international locations. The “Platinum Card” carries an annual fee of $399. Platinum supplementary cards are $175 and Gold supplementary cards are free. Every new cardholder will receive a welcome bonus of 2,500 or 5,000 “Aeroplan Miles,” depending on the card. AmEx won the right to team up with Aeroplan after the court overseeing Air Canada’s restructuring opened up the airline’s card partnership contracts in April. Under the terms of the agreements, American Express is providing Air Canada with an $80 million credit facility, repaid as “Aeroplan Miles” are purchased.

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New Debit MasterCard Targets Public Housing Residents

Lodi, CA-based PayStar/GLOBALCash has launched the prepaid “Community Technology Network Project Debit MasterCard” for “Section 8” and public housing residents. The CTNP program initiative was developed and is administered by Worldwide Communication Group, Inc. Through this innovative Alliance Partnership, millions of Section 8 and Public Housing residents will now have an opportunity to obtain personal computers and Internet access. Worldwide Communication Group, Inc. was founded in 1995 is a commercial telecommunication corporation. PayStar Corporation ([www.paystar.com][1]) provides its distributors and clients with a suite of prepaid, stored value products.

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

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7-Eleven Phone Card Sales Up 5.5% in 2003

7-Eleven reported that gross sales of its prepaid phone cards rose 6.5% in December to $646.3 million. 7-Eleven has begun reporting prepaid phone card sales on a net method instead of a gross method. The gross method includes the face value of the card in merchandise sales, while the net method includes only the gross profit dollars from the sale of the card. 7-Eleven, Inc. is the premier name and largest chain in the convenience retailing industry.

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