Charge-Offs Forecast

Credit card losses could reach 8.0%, sharply above the 6.9% rate that had been expected only three months ago. Standard & Poor’s says credit card losses, which were already moving higher, will rise even more sharply as the unemployment rate climbs. S&P says unemployment rates may rise to 6.5% by next summer. Employment figures are due out this Friday. Despite the rising loss rate, excess spreads for Standard & Poor’s rated credit card portfolios remain healthy; the excess spread (yield less losses and cost of funds) widened to 7.5% in August from 6.2% a year earlier. In addition, since August, the federal funds rate has dropped another percentage point.

Details

Xmas Forecast

American consumers plan to spend an average of $940 per household this holiday season on gifts for family and friends, decorations, greeting cards, and food or candy. Based on the National Retail Federation’s ‘2001 Consumer Holiday Outlook’ survey, holiday sales for November and December are expected to increase 2.5% to 3.0%. In spite of the events since September 11th, the NRF ‘Holiday Outlook’ survey shows that a large majority of respondents do not plan to drastically alter their holiday shopping behavior this year. Four out of five consumers (83.6%) plan to buy gifts and cards this holiday season for about the same number or more people than they did last year.

Details

DCTI 2Q/01

Digital Courier Technologies, Inc. , announced its financial results for FY2001 and the quarter ending June 30, 2001.

Revenues for the year ended June 30, 2001 (fiscal 2001) were $34.4 million compared to revenues of $25.8 million for the year ended June 30, 2000 (fiscal 2000). For the quarter ended June 30, 2001 revenues were $7.3 million compared to $8 million for the quarter ended June 30, 2000. The Company reported an operating loss of $(198.9) million for fiscal 2001 compared to an operating loss of $(44) million in fiscal 2000. The operating loss in fiscal 2001 included an impairment writedown of goodwill of $156.1 million, uncollectible chargeback expenses of $3.8 million and credit card association fines of $.9 million. In fiscal 2000 the Company reported uncollectible chargeback expenses of $3.1 million. For the quarter ended June 30, 2001 the Company’s operating loss was $(23.1) million compared to an operating loss of $(18.7) million for the quarter ended June 30, 2000. In the current quarter the Company reported uncollectible chargeback expenses of $3.3 million and credit card association fines of $.9 million. For fiscal 2001, the Company reported a net loss of $(195.3) million or $(4.58) per share compared to a net loss of $(34.3) million or $(.94) per share in fiscal 2000. For the quarter indeed June 30, 2001 the reported net loss was $(23) million or $(.57) per share versus a reported net loss of $(18.1) million or $(.38) per share for the comparable quarter in fiscal 2000.

The Company also disclosed that it has recently entered into a settlement with a shareholder who had received restricted shares in the Company’s acquisition of DataBank in October, 1999. The shareholder had claimed that the Company was allegedly obligated to periodically register a portion of those restricted shares through filings with the SEC and subsequently failed to do so. The agreed upon settlement releases DCTI from all related claims against the Company.

DCTI also announced that effective November 1, 2001, citing the need to focus solely on corporate structure matters, James J. Condon will remain as Chairman of the Board but will resign as the Company’s CEO. Also effective November 1, John Hanlon, the Company’s CFO since August 2000, will be appointed to the Board of Directors and assume command of daily matters as President and CFO. Hanlon has over 13 years experience as a senior financial officer, and is a certified public accountant with experience in public offerings, private placement activities, acquisitions, mergers, and joint ventures. “We are pleased that John Hanlon has accepted the appointment to the Board and the position of DCTI’s President. His dedication and integrity have been key components to the stabilization of DCTI and we look forward to the expansion of his role within the Company and on the Board,” said James J. Condon, DCTI’s Chairman.

DIGITAL COURIER TECHNOLOGIES, INC.
AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED JUNE 30, 2001, AND 2000

2001 2000
REVENUE $34,448,596 $25,819,883
COST OF REVENUE 22,565,355 16,509,887
Gross margin 11,883,241 9,309,996
OPERATING EXPENSES:
General and administrative (includes
$990,124, and $1,537,443, respectively
of stock-based expense) 13,206,118 10,698,215
Selling (includes ($29,649), and $61,500,
respectively of stock-based expense) 1,471,767 3,276,791
Research and development (includes
($363,954), and $397,426, respectively
of stock-based expense) 1,009,282 2,475,610
Depreciation and amortization 34,228,504 33,687,849
Chargebacks 3,848,739 3,144,686
Impairment write-down of goodwill 156,123,113 —
Visa and Mastercard fines 860,000 —
Total operating expenses 210,747,523 53,283,151
OPERATING LOSS (198,864,282) (43,973,155)
OTHER INCOME (EXPENSE):
Interest and other income 697,951 500,941
Gain on sale of CommTouch stock — 8,636,575
Gain on return of common shares 3,109,544 —
Loss on sale of assets (66,923) —
Interest expense (211,827) (366,137)
Other expense (9,666) (35,600)
Net other income (expense) 3,519,079 8,735,779
LOSS BEFORE INCOME TAXES AND
DISCONTINUED OPERATIONS (195,345,203) (35,237,376)
INCOME TAX BENEFIT — 369,476
LOSS FROM CONTINUING OPERATIONS (195,345,203) (34,867,900)

DIGITAL COURIER TECHNOLOGIES, INC.
AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED JUNE 30, 2001, AND 2000 (Continued)

2001 2000
DISCONTINUED OPERATIONS:
Loss from operations of discontinued
WeatherLabs operations, net of income
tax benefit of $0, $161,167, and $0,
respectively $– $(268,612)
Gain on sale of WeatherLabs operations,
net of income tax provision of $530,643 — 884,404
INCOME (LOSS) FROM DISCONTINUED OPERATIONS — 615,792
NET LOSS (195,345,203) (34,252,108)
PREFERRED STOCK DIVIDEND — —
NET LOSS ATTRIBUTABLE TO COMMON
SHAREHOLDERS $ (195,345,203) $(34,252,108)
NET INCOME (LOSS) PER COMMON SHARE:
Basic and diluted –
Loss from continuing operations $(4.58) $(0.95)
Income (loss) from discontinued operations $– $0.01
Net loss $(4.58) $(0.94)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 42,684,821 36,582,662

DIGITAL COURIER TECHNOLOGIES, INC.
AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED JUNE 30, 2001, AND 2000

Jun 30, 2001 Jun 30, 2000
Revenue $7,285,626 $8,029,618
Cost of revenue 5,045,462 7,326,490
Gross margin 2,240,164 703,128
Operating expenses:
Depreciation and amortization 3,967,570 12,836,126
General and administrative (includes
$1,245,776 and $255,652 respectively of
stock-based expense) 6,031,445 4,785,919
Selling (includes $0 and $29,694,
respectively of stock-based expense) 78,786 967,340
Research and development (includes
$0 and $363,954 respectively of
stock-based expense) 359,155 830,975
Chargebacks 3,349,739 —
Impairment write-down of goodwill 10,694,000 —
Visa and Mastercard Fines 860,000 —
Total operating expenses 25,340,695 19,420,360
Operating loss (23,100,531) (18,717,232)
Other income (expense), net 106,300 456,214
Loss before income taxes and discontinued
operations (22,994,231) (18,261,018)
Income tax (expense) benefit — 70,160
Loss from continuing operations $(22,994,231) (18,190,858)
Discontinued operations:
Gain on sale of WeatherLabs operations,
net of income tax provision — 116,933
Income (loss) from discontinued operations — 116,933
Net loss $(22,994,231) $(18,073,925)

Net loss per common share:
Basic and diluted $(0.57) $(0.38)

Weighted average common shares outstanding:
Basic and diluted 40,044,444 47,681,846

About DCTI

DCTI is at the forefront of Internet payment technology. A recognized specialist in risk management and fraud control, DCTI provides secure, reliable, and fully integrated payment software and systems for Internet merchants, financial institutions, and merchant service providers. Payment features of the DCTI system include advanced validation, fraud screening, payment authorization, settlement, and real-time reporting. DCTI’s notable client base and affiliations include U.S. and international banks and merchants and ongoing development partnerships with industry leaders such as Equifax, Global Payments, and TSAI. For more information, please visit [http://www.dcti.com][1].

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

Details

Proton Sold

Australia’s ERG Group confirmed this morning it is buying Belgian-based smart card technology company Proton World International. Under terms of the deal ERG will issue the former shareholders of Proton World (American Express, Banksys, Interpay Nederland and VISA International) approximately 75.5 million ERG shares. ERG has also agreed to pay cash consideration of approximately A$58.8 million. The sale agreements also call for long-term service level agreements to be executed by American Express, Banksys and Interpay Nederland. Proton World was formed in 1998 as a joint venture has more than 35 million Proton-based smart cards in circulation worldwide. ERG Group is a leader in integrated multi-application smart card management technology and has annual revenue of A$299.9 million.

Details

AmEx SF Promotion

San Francisco’s leading boutique hotel companies – Kimpton Group, Joie de Vivre Hospitality and Personality Hotels – team up with American Express to launch [http://www.sfonsale.com][1]. Whether it’s a business trip or spontaneous weekend getaway, visitors can now make hotel reservations online exclusively for San Francisco On Sale, the City’s annual after-holiday sale. >From January 1 to April 30, 2002, several boutique hotel properties located in a variety of neighborhoods throughout the City by the Bay will offer special $99 and $135 rates per night – all available on [http://www.sfonsale.com][2]. As an added incentive, travelers will receive an additional 10 percent discount when paying with an American Express credit card. Beginning now, reservations can be made online by visiting [http://www.sfonsale.com][3] or by calling 1-800-677-1509.

Union Square

Hotel Rex: salon style inspired by San Francisco’s rich arts and literary history, $135 per night, Joie de Vivre

Villa Florence: ideally located, Italian-style on Powell St. Cable Car line, $99 per night, Kimpton Group

Hotel Triton: chic, playful, cutting-edge design; across from ornate Chinatown dragon-gate entrance, $135 per night, Kimpton Group

Andrews Hotel: A European-style hotel with classic Queen Anne Victorian architecture, $99 per night, Joie de Vivre

Hotel Bijou: dramatic movie palace stylings and a mini movie theater off the lobby, $99 per night, Joie de Vivre

Commodore Hotel: an eye for 1920s luxury liner detailing and whimsical, Neo-Deco stylings, $99 per night, Joie de Vivre

Maxwell Hotel: handsome Theater Deco style with special services for shoppers, $135 per night, Joie de Vivre

Prescott Hotel: San Francisco’s best-kept secret; a world of elegance in the heart of San Francisco, $135 per night, Kimpton Group

Kensington Park Hotel: the Best Address on Union Square, Queen Anne style, 1/2 block to Union Square, $135 per night, Personality Hotels

Hotel Metropolis: Forces of Nature themed; vibrant colors, $99 per night, Personality Hotels

Clarion Bedford Hotel: newly renovated, contemporary design and popular with international travelers. $99 per night, Kimpton Group

Sir Francis Drake Hotel: grand, classically regal design on Powell Street Cable Car line, $99 per night, Kimpton Group

Monticello Inn: literary theme with in-room book honor bar and weekly book readings by local authors, $99 per night, Kimpton Group

Hotel Union Square: A true San Francisco hotel; ideally located on Powell Street Cable Car Line, $99 per night, Personality Hotels

Civic Center

Phoenix Hotel: hip ambiance, with island style, popular with the rock `n’ roll set, $99 per night, Joie de Vivre

Nob Hill

Nob Hill Lambourne: pampering, picturesque European style in a tranquil setting on Nob Hill, $135 per night, Joie de Vivre

Hotel Vintage Court: features a taste of the Wine Country in the City, $99 per night, Kimpton Group

Juliana Hotel: sophisticated style and European-style decor, favorite among women travelers, $99 per night, Kimpton Group

Theater District

Serrano Hotel: features a game theme with its eclectic, Spanish revival decor; one block from A.C.T., $135 per night, Kimpton Group

Savoy Hotel: like a little slice of Paris with charming turn-of-the-century style, $135 per night, Joie de Vivre

Hotel Diva: elegantly cool, modern; across from Curran & A.C.T.; One block to Union Square, $135 per night, Personality Hotels

Marina District

Hotel Del Sol: vibrant, colorful, beach bungalow style, in the happening Marina District, $135 per night, Joie de Vivre

Alamo Square

Archbishop’s Mansion: historic French chateau mansion and B&B on Alamo Square Park, $135 per night, Joie de Vivre

Financial District

Galleria Park Hotel: art nouveau decor ideally located near Union Square, $99 per night, Kimpton Group

Embarcadero

Harbor Court Hotel: residential feel on the Bay with spectacular views, $99 per night, Kimpton Group

[1]: http://www.sfonsale.com/
[2]: http://www.sfonsale.com/
[3]: http://www.sfonsale.com/

Details

CYOTA DIGIPASS

VASCO, a global provider of
enterprise-wide security products that support e-business and e-commerce,
announced a strategic partnership with Cyota, a
leading payment security company. Under the agreement, both Cyota and VASCO
will cross-sell products to their individual client base. Cyota has
integrated VASCO’s Digipass security and authentication technology to its
Cyota SecureSuite product line, increasing the range of authentication and
security platforms that it supports. As a leading payment and security
technology company, Cyota offers a comprehensive line of products that protect
cardholders while shopping online and address the challenges of online fraud
and chargebacks. SecureSuite is the first product to combine security
initiatives mandated by Visa and MasterCard, as well as additional proprietary
secure payment solutions such as single use or surrogate numbers into a single
platform.

“VASCO and its Digipass technology is a perfect complement to our consumer
payment and security solutions, which already support a wide variety of
authentication devices and methods,” noted Naftali Bennett, President and CEO
of Cyota. “By integrating Digipass security functionality into our products,
our customers can offer their cardholders Digipass’ strong authentication and
e-signature security. We are particularly excited about these benefits for 3D
Secure (Verified by Visa) transactions. Cyota’s Verified by Visa product —
Cyota SecureVbV(TM) — allows cardholders to confirm each online purchase with
a password. The combination of both Cyota Secure VbV and Digipass will enable
card issuers to protect consumers and ensure strong authentication without any
software download or hardware installation on the cardholders’ PC. We look
forward to working closely with VASCO to provide both of our client bases the
broadest range of payment, security and authentication solutions.”

“Our partnership with a leading e-commerce company like Cyota represents
another milestone in VASCO’s e-commerce strategy, and proves the value and
flexibility of our security products for the rapidly growing consumer payments
market,” explained Jan Valcke, Executive Vice President of Sales and Marketing
for VASCO. “Now, anyone utilizing Cyota’s system can offer consumers the
advantages of Digipass strong authentication and e-signature, with a range of
secure user platforms ranging from hardware authenticators and smart cards to
Digipass software, smart-phones, and PDA’s.”

SecureSuite is a modular online payment security platform designed to
support a wide range of authentication and credit card security products while
providing a unified user experience. SecureSuite includes 3D Secure (Verified
by Visa) and MasterCard SPA-compliant products, as well as
CyotaSecureClick(TM) — an innovative and proprietary solution that enables
cardholders to shop online without revealing their real credit card numbers by
issuing a surrogate number for every purchase. With one backend integration,
SecureSuite allows banks, to offer consumers a single user experience that
supports association standards, payment security and transaction products.

Proven at over 600 corporations, financial institutions, and government
agencies worldwide, Digipass utilizes patented dynamic password and digital
signature technologies to establish a trusted digital identity for online
users and to safeguard the integrity of data and transactions. At this
moment, more than 170 financial institutions globally that have put their
trust in VASCO to secure their corporate networks and their customers personal
data and transactions, including ABN AMRO, Arab Bank Jordan, Beneficial Bank,
Cortal Bank, Fifth Third Bank, Hamburgische Landesbank, National Westminster
Bank, OCBC Bank, First Union and SEB Group.

About VASCO

VASCO secures the enterprise from the mainframe to the Internet with
infrastructure solutions that enable secure e-business and e-commerce, protect
sensitive information, and safeguard the identity of users. The Company’s
family of Digipass(R) and VACMAN(R) products offers end-to-end security
through strong authentication and digital signature, enterprise Single
Sign-On, and LAN security, while sharply reducing the time and effort required
to deploy and manage security. VASCO’s customers include hundreds of
financial institutions, blue-chip corporations, and government agencies in
more than 50 countries. More information is available at
http://www.vasco.com .

About Cyota

Cyota is a leading payment security company that is dedicated to helping
financial institutions secure customer relationships through reliable,
flexible, easy to use online payment security products. Cyota SecureSuite(TM)
is a revolutionary platform designed to serve as the backbone for integrating
numerous e-payment initiatives. Cyota services multiple clients in North
America and worldwide. Founded in 1999 by leading card and security industry
experts, Cyota is headquartered in New York with offices worldwide. Cyota is
led by a respected management team with extensive experience in the security,
Internet and banking industry and is supported by an international Advisory
Board comprised of world-renowned financial and security experts.

Details

USA DOD CONTRACT

Infineon
Technologies, the world’s leading supplier of integrated
circuits for chip cards, announced that it is supplying secure
microcontroller chips used in smart cards now being issued by the U.S.
Department of Defense (DoD). The Infineon chip is a component of the only
currently available smart card that meets the stringent requirements specified
by DoD, including FIPS 140-1 Level 2 Certification by the National
Institute of
Standards and Technology (NIST). The DoD Common Access Card (CAC) is being
rolled out as the single standard means of physical identification, building
access and computer network access for approximately four million civilian and
military employees and outside contractors.

Infineon manufactures the secure microcontroller used by SchlumbergerSema in
the smart cards provided to the DoD by Electronic Data Systems Corporation
(EDS) under a contract awarded as part of the Defense Manpower Data Center’s
Common Access Card (CAC) program.

In smart cards like those used in the CAC program, the secure microcontroller
works like the processor of a personal computer to run the operating system
and
application software. The microcontroller has advanced security capabilities
built-in, such as support for Public Key Infrastructure (PKI) and digital
signature technology. These features work with other elements on the smart
card
to protect stored data and to ensure that only the individual owner of a card
is able to use its features. In addition to the microcontroller, the card
contains a magnetic stripe, a linear bar code, a 2D bar code, a photograph,
and
several anti-counterfeit security features.

The CAC program specifies smart card technology that is based on the open-Java
platform and meets the stringent requirements of Federal Information
Processing
Standards (FIPS) 140-1 Level 2 certification. This provides both high-level
security capability and the flexibility for the DoD to add additional
application programs to the smart card in the future.

‘With our 15-year history as a supplier of chip card ICs and leading position
as a supplier of secure ICs for identification and authentication, Infineon
was
one of a few companies to consult with DoD officials as they planned the
implementation of the CAC system,’ said Joerg Borchert, vice president of the
security & chip card business group of Infineon Technologies North America
Corp. ‘We are now very honored that our microcontrollers are used in DoD smart
cards that are fully compliant with the smart card security requirements
defined by the U.S. government for this project.’

‘Since entering the chip card IC market, Infineon has acquired extensive
skills
in all the security areas associated with this technology,’ said Dr. Soenke
Mehrgardt, Chief Technology Officer at Infineon Technologies. ‘The confidence
of the DoD in our security chip card controllers as well as the fact that our
latest chip card controller last week won the prestigious ´Sesames 2001´ award
for the best technological innovation within the chip card industry reinforces
Infineon’s leading position in the market for security semiconductor
solutions.’

About Infineon

Infineon Technologies AG, Munich, Germany, offers semiconductor and system
solutions for applications in the wired and wireless communications markets,
for security systems and smartcards, for the automotive and industrial
sectors,
as well as memory products. With a global presence, Infineon operates in
the US
from San Jose, CA, in the Asia-Pacific region from Singapore and in Japan from
Tokyo. In the fiscal year 2000 (ending September), the company achieved sales
of Euro 7.28 billion with about 29,000 employees worldwide. Infineon is listed
on the DAX index of the Frankfurt Stock Exchange and on the New York Stock
Exchange (ticker symbol: IFX). Further information is available at
www.infineon.com

Details

HOME CAPITAL 3Q/01

Home Capital Group Inc. (TSE:HCG.B) announced results for the third quarter.
These results were generated by the
Company’s wholly owned subsidiary, Home Trust Company.

– This represents the 25th consecutive quarter in which earnings have
exceeded those of the previous quarter.

– Home Trust’s core residential first mortgage business demonstrated
steady growth throughout the quarter as housing demand stayed strong
and interest rates remained favourable.

– The Company completed its fourth sale of mortgage-backed securities,
in the amount of $20.3 million.

– In September, Home Capital completed the sale of 1.4 million Class B
subordinated voting shares.

– The Company is confident in its ability to continue its strong
earnings trend.

HOME CAPITAL GROUP INC.

TO OUR SHAREHOLDERS

Net Earnings Increase for 25th Consecutive Quarter

Home Capital Group Inc. continued to perform strongly through the third
quarter of 2001, achieving outstanding increases in net earnings, earnings per
share and growth in total assets. The Company, through its wholly-owned
subsidiary Home Trust Company, has now achieved consistent quarter-over-
quarter increases in earnings for 25 consecutive quarters.

Quarterly Earnings Increase 50%

Net earnings for the three-month period ended September 30, 2001 rose
50.0% to $3,982,082 from $2,654,389 for the same period a year earlier.
Earnings per share were $0.26, a significant increase of 44.4% over $0.18 in
the third quarter of 2000. Return on equity climbed to 25.1% in the third
quarter, up from 23.3% recorded last year.

For the nine months ended September 30, 2001, net earnings rose 44.0% to
$10,745,984 from the $7,461,379 recorded for the first nine months of 2000.
Net income per share increased from $0.51 to $0.72, and on a fully-diluted
basis from $0.49 to $0.66.

Strong Performance in a Challenging Economy

Despite the tragic events of September 11 and the resulting economic
fallout, Home Capital has continued to meet its performance targets. An
initial drop in mortgage applications was quickly followed by a return to
normal levels of activity. Home Trust’s core residential first mortgage
business demonstrated steady growth throughout the quarter as housing demand
stayed strong and interest rates remained favourable.

Total assets continued to grow during the quarter, reaching $1.1 billion
by September 30, 2001. This represents an increase of 31.2% over total assets
on September 30, 2000.

Home Trust VISA Expands Cardholder Base

The number of cardholder accounts passed the 20,000 mark in early July
and reached 24,238 on September 30, 2001. This represents an increase of 4,798
cardholders, or 25% in the quarter. The total value of receivables almost
doubled during the quarter, from $5,704,195 at the end of the second quarter
to $10,102,761 on September 30. The Company is very encouraged by the market
acceptance of this service and has market tested several variations of secured
and unsecured VISA card products. A portion of our unsecured credit card
portfolio has performed below expectations and revised underwriting guidelines
have been implemented to correct this unsatisfactory performance. It will be
necessary to accommodate some writeoffs over the next two quarters until this
portion of the portfolio is eliminated, however the amounts will not
materially detract from the Company’s overall financial performance.

Going forward, the Company intends to repatriate some administrative
functions that had previously been outsourced. These would include credit
adjudication, payment processing, and collection of overdue accounts. By
moving these activities in-house, the Company expects to achieve significant
cost savings and improved efficiencies. We anticipate that card operations
will become profitable in 2002.

Company Launches Retail Credit Services

Late in the second quarter, a unit was established to provide financing
for customers purchasing products from established merchants. Employees well
experienced in this segment of lending were recruited and results to date have
been most encouraging. After four months of operations, receivables have
reached $2.2 million and Retail Credit Services is making a positive profit
contribution to the Company before provisions for losses. Delinquency in the
portfolio is minimal with no losses to report.

Company Completes Largest Sale of Mortgage-Backed Securities

During the quarter, Home Capital successfully completed the sale of more
than $20 million in mortgage-backed securities, its largest sale to date. The
Company views securitization as a promising and growing line of business. What
began as a pilot project has now become a sustainable, ongoing business
program.

Company Maintains Conservative Approach to Risk

Net impaired loans as at September 30, 2001 represented 0.52% of total
loans outstanding, a slight increase compared to 0.50% on September 30, 2000.
This increase is due primarily to arrears in British Columbia. The
collection/foreclosure process in that province extends the resolution period
to twelve months, resulting in expanding arrears totals. Losses are not being
incurred and are not expected on the files under collection. The Company
continues to closely monitor impaired loans.

The Company has increased the general allowance to $5.2 million which
represents 89.5 basis points of risk-weighted assets at September 30, 2001,
compared to the $3.9 million and 81.7 basis points provided in September of
the previous year. This brings the Company close to its year-end goal of
increasing the general provision to 90 basis points. Home Capital will
continue to maintain this conservative approach, and plans to further enhance
the general provision to 100 basis points of risk weighted assets by December
31, 2002.

Home Capital Successfully Completes Issue of Class B Shares

In September, Home Capital successfully completed the sale of 1,400,000
Class B subordinated voting shares. The Class B shares were issued under a
short form prospectus dated August 29, 2001, and were sold through Sprott
Securities Inc. for gross proceeds of $13,440,000. The net proceeds of the
offerings were used to strengthen the capital base of Home Trust Company, to
facilitate future mortgage lending, and for working capital and other general
corporate purposes.

New Initiatives Improve Service and Efficiencies

Subsequent to the third quarter, Home Capital Group successfully
completed the implementation of a new banking and mortgage computer system,
with an improved mortgage origination system to accommodate increased business
volumes. The benefits will be improved efficiencies, faster response time and
enhanced customer service.

Company Announces Quarterly Dividend

The Board of Directors declared a quarterly dividend of $0.025 per share
payable on December 1, 2001 to shareholders of record at the close of business
on November 15, 2001.

Outlook Remains Excellent

The outlook for the fourth quarter for Home Capital Group is excellent.
Demand for our products remains constant and we continue to carefully manage
the risk profile of our portfolios. We are confident in our ability to
continue our strong earnings trend.

GERALD M. SOLWAY

President & Chief Executive Officer

October 30, 2001

Details

SIMERA CLASSIC

SchlumbergerSema announced
that Smart Communications has chosen its new-generation Simera Classic 64K
Java SIM smart cards as the platform to
increase market share with a growing portfolio of data services.

Smart Communications is the Philippines’ leading digital wireless operator
with over 4.7 million subscribers on its GSM network. Its network services
cover the mobile waterfront, and it has been particularly successful in
leveraging the data messaging capabilities of short message services (SMS)
and the power of the SIM toolkit to give mobile consumers friendly and
simple access to a wide range of centralized information content.

With almost a hundred million SMS messages sent every day, the Philippines
is the SMS messaging capital of the world, and Smart already handles an
average of 45 million outgoing messages per day. By doubling the memory
available to subscribers for storing service application software, the
SchlumbergerSema Simera Classic 64K SIM gives Smart a powerful
differentiator in the data services arena. It provides the ideal proven
Java platform for Smart to build on its leading market position by
continuing to optimize the service perception of the customer, in turn
boosting revenues from the SMS channel.

Smart’s service portfolio is exceptionally broad, combining conventional
offerings – such as weather and traffic updates, news, mobile chat, exchange
rates, airline and entertainment schedules – with many novel services such
as prepaid reload and purchases through its ‘Smart Money’ service,
horoscopes and biorhythms. It even provides subscribers with recipe ideas
for an evening meal while they are out shopping. The Simera Classic 64K SIM
will double or treble the number of “easy-access” services that can be made
available to the subscriber, as well as supporting increasingly
sophisticated services which leverage its additional memory to provide high
levels of security and enhanced usability.

>From the subscriber’s point of view ‘more’ is definitely better when it
comes to mobile services. With Simera Classic 64K SIM, Smart’s subscribers
can multiply the number of services they can access, giving the operator a
real advantage. At the same time, the advanced Java Card(-compliant
technology positions Smart to rapidly take advantage of increases in
bandwidth as 2.5G technologies arrive, supporting over-the-air downloads to
make one-to-one marketing a practical reality.

The Simera Classic 64K SIM reflects the SchlumbergerSema commitment to
deliver state of the art mobile services and Java technology. Full
conformance to the latest standards for over-the-air downloading, source
code development, and applet loading and processing make the Simera Classic
64K SIM an ideal launch pad for more services and new subscriber servicing
strategies. To a proven and stable Java Card platform, it adds the power
and memory capacity to integrate the state-of-the-art security required for
a new generation of applications, such as m-commerce and the new generation
of location-based services.

In the highly competitive mobile marketplace where customer loyalty is a
distinct advantage, the ability to deliver imaginative and accessible new
services is critical to operators’ success. The higher memory capacity of
the Simera Classic 64K SIM is designed to support more and more
sophisticated applications to meet the demands of an increasingly discerning
subscriber base.

About SchlumbergerSema

SchlumbergerSema is a leading information technology services company
providing consulting, systems integration, managed services, business
continuity systems, products and IP network security solutions serving the
telecommunications, utility, finance, transport, oil and gas, and public
sector markets. With more than 30,000 employees in 130 countries,
SchlumbergerSema is one of two business segments of Schlumberger Limited, a
global technology services company. For more information about
SchlumbergerSema, visit http://www.slb.com/.

About Smart Communications

Smart Communications, Inc. is the leading wireless operator in the
Philippines providing a wide range of innovative services to the 5 million
subscribers on its GSM network. It is a wholly owned subsidiary of the
Philippine Long Distance Telephone Company (PLDT), the country’s largest
telecommunications and multimedia company. For more information, please
visit www.smart.com.ph.

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OKI SIGNS MIST

MIST Inc., a global leader
in wireless transaction technology, announced it has expanded its
offices to Tachikawa-city, Japan and signed an agreement to provide Oki
Electric Industry Co. Ltd., a leading manufacturer of telecommunication
systems, information systems and electronic devices, with customized security
technology for ATM financial transactions.

The three-part MIST/Oki agreement encompasses the licensing of customized
security technology, including research and development for software and
hardware as well as unit manufacturing. The technology will enhance security
for customers making ATM transactions.
“MIST’s expertise in the wireless industry will most certainly assist the
growing needs of the Asian market,” said Charles E. Lee, chief executive
officer and president of MIST Inc.
“The greatest advantage that MIST provides is a secure gateway and a
variety of
customized software applications and products. In our agreement with Oki, we
will provide additional security technology and support for ATM financial
transactions.”
The security technology is compatible with MIST’s FreedomGate(TM), the
multiple-transaction processing facilitator through which wireless
transactions
are completed. FreedomGate provides users with remote loading of software and
enables updates to each terminal at one time and from one location.
FreedomGate also provides a re-programmable security device and key injection
solution providing PIN changes at varying frequency to minimize security
risks.

“Oki, as Japan’s top ATM vendor, has been providing excellent products in the
ATM market,” said Haruo Kimura, general manager, terminal systems division of
Oki Electric Industry Co. Ltd. “This agreement will enable us to develop
highly
secure and user-friendly ATMs to meet market needs.”

About MIST Inc.

MIST Inc., a leading provider of wireless transaction-enabling technologies,
designs, manufactures and distributes wireless and wired point-of-sale
solutions. The MIST “Freedom family” of wireless transaction terminals was
developed to complement its range of existing products.
The MIST FreedomGate(TM) provides gateway services with value-added options
such as messaging, time and attendance and e-commerce.
With facilities in Canada, the United States and Japan, MIST’s clients include
North American and international banks, financial institutions, credit and
debit card processors, as well as retail, hotel, restaurant, health care and
loyalty customers. For more information, visit
www.mistwireless.com. Investors
may contact investor-relations@mistwireless.com.

About Oki Electric Industry Co. Ltd.

Founded more than a century ago in 1881, Oki Electric Industry Co. Ltd. is
Japan’s first telecommunications manufacturer headquartered in Tokyo. With
more
than 25,000 employees worldwide, Oki Electric provides customers with
top-notch
products and technologies for telecommunication systems, information systems
and electronic devices. Visit Oki’s global Web site at
http://www.oki.com/.

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Authorize.Net VBV Ready

InfoSpace, Inc., a provider of wireless and Internet software and application services, announced that the company’s Authorize.Net* payment processing platform will offer real- time payer authentication anti-fraud technology that meets Verified by Visa compliance standards.

This agreement demonstrates InfoSpace’s commitment to leveraging new technologies to provide partners with the ability to deploy cutting edge services to their customers. The new service, which complies with the guidelines set forth under the Visa 3-D Secure global interoperability standard, offers participating merchants a fast and effective means to confirm the identity of a user, greatly increasing the security of online transactions and giving a new piece of mind to participating merchants who accepts payments online.

Verified by Visa allows consumers to actively protect their Visa accounts from unauthorized use by selecting a personalized password. Each time cardholders make purchases at participating online stores, they are automatically presented with a Verified by Visa window where they enter their password and authenticate themselves to the Issuer. Verified by Visa significantly minimizes fraud and customer disputes because only the cardholder and their card Issuer know the password.

In cases where a cardholder has not yet enrolled in the Verified by Visa program, and for all other credit cards and online checks used in online transactions with participating merchants, iShopSecure’s proprietary TRANSACT-SECURE* technology performs real-time multi-tiered authentication of the purchaser’s identity during checkout using information that is only known by the actual cardholder.

Together, Verified by Visa and TRANSACT-SECURE help merchants prevent credit card and eCheck fraud during checkout. Additionally, transactions from online merchants and telesales who sign up for the TRANSACT-SECURE service carry the iShopSecure insurance of up to $5,000 per transaction.

“Authorize.Net merchants will now be able to take advantage of these payer authentication solutions which we believe will greatly enhance fraud protection for both our merchants and their customers,” said Roy Banks, general manager of Authorize.Net. “This common sense approach to preventing fraud is tightly integrated into our gateway and represents a robust new revenue stream for Authorize.Net and our resellers.”

“We are very excited about our relationship with InfoSpace,” said Joseph A. McDonnell, chairman and chief executive officer of iShopSecure, Inc. “iShopSecure is proud to offer Authorize.Net merchants both the Verified by Visa and TRANSACT-SECURE service which carries an insurance policy up to $5000 per authenticated transaction for all major credit cards and eChecks.”

InfoSpace’s Authorize.Net* service has been pioneering online payment processing solutions since 1996 providing server-based payment solutions that enable merchants to process transactions in a secure, real-time environment 24 hours a day. Over 120,000 merchants have signed up for Authorize.Net, which enables merchants to authorize, process, and manage credit card and electronic check transactions on Internet-enabled mobile devices and personal computers.

About InfoSpace, Inc.

InfoSpace, Inc. (NASDAQ: INSP) provides an integrated technology platform and suite of applications that enable partners to deliver consumer and commerce services across the Internet to any device over current and next-generation wireless, broadband and narrowband networks. The Company’s array of products includes consumer services, such as communication, entertainment, gaming and speech applications, as well as commerce services, including payments, promotions and shopping. Together, the InfoSpace platform and applications comprise a highly flexible and scalable end-to-end solution that can be rapidly deployed under a partner’s brand. InfoSpace’s partners and affiliates include more than 3,200 Web sites and companies worldwide, including Verizon, AT&T Wireless, Cingular Wireless, ALLTEL, Virgin Mobile, Charles Schwab, Intel, Lucent, Nortel, AOL, Microsoft, Lycos, National Discount Brokers and Bloomberg, among others.

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724 3Q/01

724 Solutions Inc. reported results for the third fiscal quarter ended
September 30, 2001.

Third fiscal quarter revenues were approximately $10.0 million, compared
to $6.1 million for the same period last year, a 64 per cent increase. Pro
forma net loss for the third fiscal quarter was $17.0 million, or $0.29 per
share, compared to $10.9 million, or $0.29 per share in the same period last
year. Pro forma net loss and net loss per share include net loss for the
period, adjusted for amortization of intangibles (including goodwill), stock-
based compensation, equity in income (loss) of affiliate, restructuring costs,
write-down of intangibles and other assets (including goodwill) and long-term
investments. In addition, in the quarter the company recorded a one-time, non-
cash charge of $329.1 million primarily related to the partial write-down of
long-term investments and goodwill from acquisitions. (All amounts in U.S.
dollars)

“724 Solutions remains distinctively positioned to be a winner in the
provision of secure mobile transactions infrastructure and solutions to
financial services companies, and we are now extending our core competencies
into the mobile network operator marketplace,” said John Sims, Chief Executive
Officer, 724 Solutions. “The market opportunity before us is as big as we ever
perceived, and with our strong cash position and ongoing cost re-alignment, we
believe that we will be able to continue to sustain the investment in our core
opportunities while driving the company towards profitability.”

The company ended Q3 with over $107.0 million in cash, cash equivalents,
and short-term investments, and it is on track to reduce quarterly cash
operating expenses by approximately 50 per cent — to $12.0 million — by Q1,
2002.

Outlook:

The company expects that the current economic conditions will persist
through the next several quarters. It anticipates that fourth quarter 2001
revenues will be in the range of $7.0-8.0 million. As the current macro-
economic environment improves, the company will provide additional guidance on
its business in 2002.

Third quarter highlights:

724 Solutions delivers additional solutions to financial services
marketplace

During the quarter, 724 Solutions developed solutions with other
providers of advanced technologies to help accelerate consumer adoption of
wireless applications for the financial services market. For example, by
integrating 724 Solutions’ alerts and aggregation product offerings with
Ezenet’s wealth management technology, the companies will market the solution
to North American financial institutions.

The company also launched its multi-modal strategy, which is aimed at
redefining consumers’ wireless Internet experiences by creating an advanced
wireless offering that allows consumers to seamlessly move from voice to text,
depending on their surroundings and the type of transactions they are
conducting. As part of its multimodal strategy, the company announced a
relationship with leading interactive voice response (IVR) technology company
— InterVoice-Brite, Inc. — whose IVR solution and speech technologies are
planned to be used by 724 Solutions to add voice capabilities to its suite of
products.

724 Solutions enters new industry sector

This quarter, the company announced that it has broadened its focus by
offering solutions that leverage mobile network operators’ (MOs) existing
infrastructure investments. To accomplish this, 724 Solutions has extended its
core competencies of security, scalability, money transactions, alerts and
platform to create the following offering:

– 724 FrameWorks (FW) – a software portfolio that provides server-side
applications to extend transactions to wireless devices. FW supports
on-line shopping, brokerage and banking applications by providing
interfaces for credit/debit card authorization, settlement,
reconciliation and private label card processing.

– 724 Payments – a complete commerce solution that is built on top of FW
to facilitate secure, personalized, consumer and merchant interaction
and payment completion.

– 724 Alerts – provides mobile operators with the capability to enable a
broad range of third-party applications to deliver interactive
actionable alerts in a broad range of industry verticals.

In addition, 724 Solutions announced two new customers for this industry
sector:

– Nortel Networks, a global leader in networking and communications
solutions and infrastructure for service providers and corporations,
that has signed an OEM agreement to incorporate 724 Solutions’ 724
FrameWorks and 724 payments solutions with its Network Gateway Server
and wireless infrastructure equipment;

– Aspire Technologies (ShenZhen) Ltd, China, has licensed the 724
FrameWorks solution. The solution will be used by Aspire in its Mobile
Information Service Centre offering to mobile operators in China,
allowing them to offer a multi-channel portal service providing easy
access information on the latest in news, weather, sports, and
entertainment, as well as more specialized content such as financial
stock quotes, and e-mail services. The 724 FrameWorks solution will
enable user authentication, protocol translation, portal navigation,
and data roaming capabilities.

About 724 Solutions Inc.

724 Solutions Inc. is a leading global provider of Internet
infrastructure software that enables the delivery of secure financial services
applications and mobile transaction solutions across a wide range of Internet-
enabled devices. The 724 Solutions suite of products and services enables
companies to realize value through the mobile Internet by building, deploying,
and integrating personalized and secure mobile commerce and lifestyle
applications. With dual headquarters in Toronto, Canada, and Austin, Texas,
the company has development and sales offices around the world. 724 Solutions’
common shares are listed on the NASDAQ National Market (SVNX) and The Toronto
Stock Exchange (SVN). For additional information visit
http://www.724.com.

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