GEMPLUS 2Q/01

Gemplus International S.A. reported results for the second quarter ended June 30, 2001. Revenue for the second quarter was 252 million Euros, down 8% from the same quarter a year ago. Operating loss, before restructuring, was 12 million Euros, compared with an operating profit of 34 million Euros for the same quarter a year ago. Operating loss, after restructuring, was 41 million Euros. Net loss for the second quarter, including restructuring, was 40 million Euros, or 0.06 Euro per fully diluted share. Net loss for the quarter, excluding restructuring, was 21 million Euros, or 0.03 Euro per diluted share.

“Our second quarter operating results reflect the progress we have made in strategically repositioning the company,” said Antonio Perez, president and CEO. “We have adjusted and realigned our resources to exploit the opportunities in the Telecommunications, Financial Services and E-Business Security Applications markets.”

The company announced that it had successfully implemented its planned restructuring program. “This is a major step forward to increase our financial competitiveness,” added Perez. “This restructuring will reduce headcount by 567 people by the end of 2001 and save the company 40 million Euros in annual expenses, with about 17 million of the savings occurring in the second half of the year.” The company noted that it would be taking a 28 million Euro restructuring charge. No social plan was implemented in France.

Perez also noted that the sale of its SkiData operation complements its restructuring programs and would enhance the company’s strategic focus. Gemplus announced an agreement to sell Skidata to Kudelski S.A. in June and expects to finalize the transaction shortly.

“I am also very pleased with the continued rapid growth and margin improvement that we are seeing in our Financial Services Business,” added Perez. Earlier, the company announced that this business unit had recently been awarded a major contract with the Target Corporation. “These recent developments demonstrate that our strategy is on track. The contract with Target Corporation, the fourth largest general merchandise retailer in the U.S., is particularly interesting as it marks a significant milestone in the adoption of smart card based solutions in the U.S. retail sector.”

The company indicated that its reported results included a favorable 10 million Euro royalty expense adjustment. “While we achieved our goal of restructuring to improve our cost base and competitiveness, we had to deal with the challenging Telecommunications market and resulting softness in our GSM business,” commented Perez. “The impact of the business mix shift from Telecommunications and GSM to Financial Services has been felt in gross margin. However, the underlying rapid growth and significant margin improvement in our Financial Services business are very exciting.”

“We expect to maintain our leadership market share in the SIM card market and are encouraged by signs that the excess SIM inventory at operators are coming down,” added Perez. “We should see a more reasonable balance between inventory and end-user demand by the end of the year.” The company now believes that the market for GSM SIM cards is around 300 million units which based upon historical correlation implies a total number of mobile handsets shipped by manufacturers this year to be 375-380 million units.

Looking forward, Gemplus indicated that it expects third quarter revenue to grow 7% sequentially with operating losses of about 13-18 million Euros. For the year 2001, the company expects revenue will be flat to down compared to the year 2000 with operating profit, before restructuring, at about 5 million Euros.

Cash and cash equivalents were 430 million Euros at June 30, 2001. The company’s financial results were derived from its consolidated financial statements, which have been prepared in accordance with International Accounting Standards (IAS).

About Gemplus

GEMPLUS: the world’s number one provider of solutions empowered by Smart Cards (Gartner Dataquest 2001).

Gemplus helps its clients offer an exceptional range of portable, personalized solutions that bring security and convenience to people’s lives. These include mobile Internet access, inter-operable banking facilities, e-commerce and a wealth of other applications.

Gemplus is the only completely dedicated, truly global player in the Smart Card industry, with the largest R&D team, unrivalled experience, and an outstanding track record of technological innovation.

Gemplus trades its shares on Euronext Paris S.A. First Market and on the Nasdaq Stock Market(R) as GEMP in the form of ADSs. Its revenue in 2000 was 1.205 billion Euros. It employs 7800 people in 37 countries throughout the world.

Gemplus: Your Passport to the Digital Age — www.gemplus.com

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$30+ Late Fees

Late payment and over-limit fees continue to test the $30 barrier. This week Metris/Direct Merchants Bank unleashed an 0% APR ‘Titanium MasterCard’ which carries a late payment fee and over-limit fee of $34. The ‘Metris MasterCard’ also carries a 4% balance transfer fee and cash advance fee subject to a $4 to $15 minimum, according to CardWatch (www.cardwatch.com). Last November, Fleet Credit Card Services began charging a $35 late fee on all its card products including the new ‘Fusion smart VISA’. However Fleet has continued to cap over-limit fees at $29. Advanta was the first card issuer to institute $35 fees for holders of its business card products. Industry wide late payment fees currently average $27.88 and over-limit fees currently average $26.32, according to CardData (www.carddata.com). The most commonly charged late and over-limit fee among major issuers is $29. (CF Library 11/7/00)

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GRADUATE ACCOUNT

Average salaries for this year’s graduates have risen by an inflation-busting 8%, according to the 2001 NatWest Graduate Survey. Nearly one third of graduates had a job lined up before they finished their exams and, on average, they will be earning £13,410.

The hike in salaries has perhaps been driven by the hard bargaining of this year’s debt ridden graduates who are finishing their studies with average debts of £9,000. This is a rise of 40% on last year’s figure and graphically illustrates the full impact of the withdrawal of local education funding and the introduction of tuition fees.

Despite the prospect of finishing college with huge debts, graduates have a positive outlook: 58% claim not to be worried about the money they owe, and getting a job just to pay off their debts is the least important consideration when they are looking for that first job. Only 37% cited paying off debts as an important reason for choosing a particular job, whereas 74% said that a job with long term career prospects was more important and 84% said that a job which they enjoy was the most important factor when finding a job.

Commenting on the Money Matters Survey, Ann-Marie Blake, Head of Graduate Banking Services, said: “This is encouraging news for students worried about the amount of debt they will have when they finish their studies. Whilst debt is rising, so too are their prospects of finding a well paid job.”

NatWest Graduate Package in detail:

ADVICE AND SUPPORT

· 60 specially trained Graduate Advisers available in most university towns.

· A job finding, home finding and car finding service via · .

· The Graduate Travel Club offering cash discounts on a range of holidays, car hire and flights. The club also includes discounted Travel Insurance along with commission free currency and American Express travellers cheques.
OVERDRAFTS AND LOANS

· The interest-free overdraft is £2,000 in the first year after Graduation, reducing to £1,000 and £500 in the 2nd and 3rd years after graduation respectively or

· The Graduate Overdraft Repayment Plan to repay student overdraft interest-free in structured monthly payments up to a maximum of £2,000. These repayments can be spread over three years with loan repaid by the end of graduate terms and

· Graduate Loan for borrowing between £1,000 and £10,000 at a preferential rate (7.5%) with optional repayment holiday of four months or up to 12 months if the graduate is travelling. The loan is available for five years for up to and including £5,000 and up to seven years for loans between £5,100 and £10,000.

BANK ACCOUNT FACILITIES

· Cheque book and Switch card.

· Free access to 28,000 cash machines in the UK and over 500,000 world-wide.

· Free 24-hour telephone banking and a free Internet banking service.

MORTGAGE DEAL

· Graduate mortgage deals.

· Up to 100% mortgages.

· No Mortgage Indemnity Insurance fee payable.

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govONE Acquisition

CO-based govONE Solutions announced this morning it will acquire the assets of MA-based TAXWARE International. While govONE Solutions is focused primarily on payment processing services, the acquisition of TAXWARE’s automated, patent-pending solution adds transaction tax calculation to simplify the entire end-to-end transaction chain. Under the terms of the agreement, govONE Solutions will acquire the assets of TAXWARE for $32 million in cash and a minority equity investment in govONE Solutions. The 150 employees of TAXWARE will become employees of govONE Solutions.

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WAFER-PIERCE

NanoPierce Card Technologies GmbH, a subsidiary of NanoPierce Technologies,
Inc. announced that initial samples of the new WaferPierce process have
been successfully produced.

Development of a test wafer in compliance with NanoPierce
specifications commenced in April of this year, when the company began
working with the Fraunhofer Institute for Silicon Technology (ISIT), a
preeminent research and development facility for silicon and wafer
technology located in Itzehoe, Germany. These wafers are now available in
pre-production quantities. The chips on the wafer have contact pads that
are compatible to the I-code chip produced by Philips Semiconductor, a
widely used chip in radio frequency identification (RFID) applications. For
the first time, NanoPierce has at its disposal wafer-based test material
made to its own specifications.

“This development represents a significant advantage for us and an
important step forward for NanoPierce,” stated Dr. Herbert J. Neuhaus,
Executive Vice President of Technology of NanoPierce Technologies, Inc.
“Previously we only had access to commercially available test material. The
test wafers which are now available to us have chips whose size and
properties closely approximate the components used in our highest priority
applications, such as smart card chip modules and smart labels.”
During the past two weeks, the first contacts were applied to these
wafers by means of the patent-pending WaferPierce(TM) technology developed
by NanoPierce in the company’s laboratory in Colorado Springs, Colorado.
“We are producing initial samples on a small scale in our in-house
lab. However, our own cleanroom, including a wetbench specifically designed
to accommodate the WaferPierce(TM) process, will be completed within the
next nine weeks,” said Dr. Neuhaus.

“These new test wafers finally enable us to provide a select group of
customers with sufficient test material,” stated Dr. Michael E. Wernle,
President & CEO of NanoPierce Card Technologies. “We are currently
producing initial samples for a range of various applications. Due to this
important breakthrough, we can now demonstrate WaferPierce(TM) to our
customers in functional applications, and we can move on to the next level
of the design-in process. This development confirms that the technical
market introduction of WaferPierce(TM) is proceeding systematically
according to both our development and our marketing plans.”

As a result of its favorable progress, NanoPierce will be
participating in the key upcoming trade fairs for semiconductor technology
worldwide. These include the IMAPS 2001 Exhibition and Conference
(Baltimore, October 2001); the SemiCon Europe (Munich, May 2002); the
SemiCon West (San Francisco and San Jose, July 2002); and the IMAPS 2002
Exhibition and Conference (Denver, October 2002).

“I am particularly pleased that Dr. Neuhaus and Bin Zou have been
invited to give a presentation at the IMAPS 2001 specifically focusing on
our WaferPierce(TM) technology,” commented Paul H. Metzinger, President &
CEO of NanoPierce Technologies, Inc., Denver. “Dr. Wernle is already
scheduled to make a presentation on the application of our technologies in
the LED field. And now we have the opportunity to report on recent
developments in the electroless process for WaferPierce(TM) to a selected
audience of technical specialists. Without a doubt, this will significantly
arouse the interest of the semiconductor industry in our company.”
NanoPierce Technologies, Inc., of Denver, Colorado, USA, is traded on
the Nasdaq stock market (OTCBB:NPCT) as well as on the Frankfurt and
Hamburg (OTC:NPI). In addition to the 12 patents it owns, NanoPierce has
numerous applications pending, others in preparation, and various other
intellectual properties related to NanoPierce’s proprietary NCS (NanoPierce
Connection System). This advanced system is designed to provide significant
improvement over conventional electrical and mechanical interconnection
methods for high-density circuit boards, components, sockets, connectors,
semiconductor packaging and electronic systems.

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Gemplus 2Q/01

While sharpening its strategic focus, smart card manufacturer Gemplus International, reported revenue of 252 million Euros and an operating loss of 12 million Euros for the second quarter. The company also announced a major contract with Target. Second quarter revenue declined 8% from the same quarter a year ago. Last year Gemplus posted an operating profit of 34 million Euros. The decline is attributed to the slowdown in the worldwide SIM card market. The restructuring underway will reduce the headcount by 567 people by the end of this year and save the company 40 million Euros in annual expenses, with about 17 million of the savings occurring in the second half of the year. Gemplus also announced the execution of a major contract with Target Corporation to provide smart cards and in-home readers for the ‘Target smart VISA’ card launch, during the fourth quarter. Target will take a lead role in advancing smart cards in the U.S. both by issuing smart cards through its Retailers National Bank affiliate and by installing POS terminals that accept chip payment in all Target Stores in 2002. Gemplus indicated that it expects third quarter revenue to grow 7% sequentially with operating losses of about 13-18 million Euros. For the year 2001, the company expects revenue will be flat or down compared to the year 2000 with operating profit, before restructuring, at about 5 million Euros. (CF Library 6/20/01) For complete details on Gemplus’ 2Q/01 performance visit CardData ([www.carddata.com][1]).

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

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PASS21 ACQUISITION

Pass21 Co., Ltd. an emerging biometric authentication solution
provider in Korea and Veridicom Inc. the leader in fingerprint-based
technologies and services, jointly announced that they have signed a
definitive agreement to acquire all assets of Veridicom, Inc. of California
including its name. Veridicom, a spin off from Lucent Technologies, was the
leading provider of silicon fingerprint sensors, fingerprint matching
algorithms, peripherals and authentication software before its fourth round
of funding failed last February. Veridicom had invested over $36 million
over the last four years and its investors included US Venture Partners,
Lucent, AT&T Ventures, Deutsche Bank, Intel, Seiko Instruments and CSK
among others. Veridicom has been looking for the right candidate for
ownership of the primary assets and had completed three transactions where
it licensed certain technology or sold certain overlapping assets. Pass21
was a customer of Veridicom, embedding Veridicom’s silicon fingerprint
sensor in its Internet online authentication solution for Internet banking
and other e-commerce applications and mobile phones to provide strong
authentication for m-commerce.

This transaction includes the following area:

— Ownership of all intellectual property and know-how related to making
the silicon fingerprint sensors FPS110 and FPS200 and their derivative products
— Ownership of all fingerprint matching algorithms and patents

— Ownership of Veridicom’s authentication server technology

— Ownership of its peripheral business and related patents

Members of the Veridicom team are expected to join this new operation
including the R&D and operations team in the US and the Japanese sales and
support team.

Sukkoo “Dave” Kim, CEO of Pass21 Co., Ltd. said: “We have long been
impressed with Veridicom’s technology. This presented us with an
outstanding opportunity to combine the talent and vast intellectual
property of Veridicom with the authentication technology and long term
vision of Pass21, where personal biometric authentication will play a key
role in mobile commerce and the way we transact e-business using the Internet.”
The transaction is expected to be completed by mid August.
“We have worked hard for the last five months to make this happen and
this news could not have come at a better time,” said Naeem Zafar,
Veridicom’s Vice President of Sales and Marketing. “We believe that with
Pass21’s vision and combined technology this new Veridicom will flourish.”
Michael D’Amour, Veridicom’s CEO added, “We have maintained our
technology with the patience and support of our customers and vendors and
we thank them for that. By placing this technology in the hands of Pass21,
the new Veridicom will now be able to serve our customers and regain our
leadership position.”

About Pass21

PASS21 Co., Ltd, headquartered in Korea, is a leader in fingerprint
authentication technology with a unique biometric authentication solution
for e-commerce and mobile commerce. It delivers technology that provides
the cyberspace security using fingerprint data coupled with PKI technology.
Its business partners include banks, credit cards companies and other
e-business providers and they are introducing the integrated authentication
technology using PKI and biometrics for more secure and convenient Internet
services. Some of the products of Pass21 include the PASS Bio Phone, a
handset equipped with a fingerprint sensor, for mobile commerce and a
integrated authentication system using PASS2001, a compact fingerprint
sensor, for e-commerce authentication targeted at applications such as
m-banking/e-banking, Internet shopping, instant credit approval, ATM cash
withdraw service, electronic money and computer data security. The
technology offers a new, simple, convenient and safe way to the worldwide
Internet users and mobile phone users.

About Veridicom

Veridicom, Inc. was the leader in fingerprint-based technologies and
services that enable trusted e-business transactions across networks,
intranets and the Internet. The company’s extremely accurate silicon
fingerprint sensors and peripherals, advanced recognition algorithms, and
authentication software allow users to conduct business on-line without
fraud or fear. Veridicom, the first technology spin-off from Lucent/Bell
Labs, is delivering solutions with a distinct advantage over other
authentication technologies that rely on passwords and personal
identification numbers (PINs) that can be lost, forgotten or stolen.
Veridicom’s fingerprint sensors are being included in laptops, keyboards
and mobile phones to provide secure authenticated access to the authorized
users. Veridicom works closely with a growing list of vendors and systems
integrators to provide network security solutions for Fortune 1000
companies around the world.

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Worldpay Survey

WorldPay, Inc., the global leader in multi-currency and multi-lingual transaction processing, released a survey of 100 leading U.S. retailer’s Web sites, finding that only a tiny fraction provide any global eCommerce capabilities that would enable customers overseas to purchase products and services from North American companies.

To test the validity of claims that companies provide global eCommerce, WorldPay logged on to U.S. retailers’ Web sites and attempted to purchase goods in currencies other than U.S. dollars and have them shipped to international locations. Among the key findings:

— 0 out of 100 companies surveyed listed prices in more than one currency on their main Web site.

— Eight out of 100 sites surveyed had created separate Web sites for non-U.S. customers, translated into the local language, but these still only accepted a single currency. While these regional sites are multi-lingual, they do not offer multi-currency options.

— Only 41 out of 100 sites surveyed had the ability to ship internationally, even if an international shopper was happy to pay in U.S. dollars.

— Of those sites that have the ability to ship internationally, 17 only allow payment in U.S. dollars.

— Five companies provided multiple sites in multiple languages – but without the ability to purchase the goods from a country outside the U.S.

— 14 out of 100 surveyed retailers do not have the ability to sell online.

WorldPay’s survey extends the findings of a recent study by IDC, which concluded that only 20 percent of eCommerce firms have multi-language sites. WorldPay’s survey, however, ends on a bleaker note: Of the eCommerce firms surveyed for multi-currency Web transactions capabilities, virtually all are ignoring millions of potential overseas customers and export sales opportunities.

“The hype of eCommerce is that U.S. companies can `do business anywhere,’ but the reality is that most are still confined within national borders because their Web sites can only process U.S. dollars,” said WorldPay Vice President of U.S. Operations, David Talley. “As a result, these enterprises are cutting themselves off from a potentially limitless global market. To be truly global, an online store must be able to sell to shoppers in the language they understand and in a currency in which the shopper understands the value,” said Talley.

“The tools for ensuring secure multi-currency online transactions are available today, and already are in use throughout the globe by WorldPay’s customers,” said Talley.

WorldPay has entered the North American market to offer U.S. businesses its proven approach to secure online payments processing. The company’s solutions enable any business to process eCommerce transactions in more than 130 currencies, extending their market reach globally. WorldPay currently has more than 10,000 business customers in nearly 100 nations.

About WorldPay, Inc.

WorldPay is a global leader in multi-currency, secure online card payments and international eCommerce solutions. WorldPay enables one of the most fundamental components of eCommerce: the ability for customers to securely purchase goods and services through the Internet, and for businesses to receive and process payments securely.

WorldPay has created eCommerce solutions that enable online credit card payments in over 130 currencies, and has partners and customers in more than 90 countries worldwide.

WorldPay provides a one-stop service to enable businesses to trade successfully online, set up online stores and accept payments without need for separate bank approval. Its cost-effective online solutions include:

— Credit and debit card processing through WorldDirect

— Credit card fraud protection for both eTailers and customers with the WorldPay Guarantee

— Online eCommerce storebuilding with Click and Build

— Integration tools for tailor made, individual eCommerce solutions

— eCommerce storefront design consultancy and support

WorldPay’s headquarters are located in Cambridge, UK, its Americas office is located in the Metropolitan Washington, D.C. area in Sterling, VA, and its Asian regional base is in Singapore.

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SMART CARDS

Schimatic Cash Transactions Network, d.b.a. Smart Chip Technologies, Inc.,
as one of the six
partners of the Solstice Alliance, announced a North American
first — a single smart card that allows Scotiabank Canadian customers to
access and choose credit and debit, micro-payments, loyalty programs, and
other services using microchip technology.

Scotiabank will use SCTN’s patented e-llegiance loyalty application
and LoyaltyCentral back-end incentive processing host to provide its
customers with powerful consumer rewards programs.
“Scotiabank is the first Canadian bank to deliver on the promise of a
one-card solution for our customers,” says Albert Wahbe, Chairman and CEO of
e-Scotia and Executive Vice-President, Electronic Banking, Scotiabank.
“Customers are demanding ‘smart’ cards that are capable of meeting many of
their lifestyle needs. The Scotiabank solution will give customers greater
control by allowing them to add and delete card services at their discretion.”
Scotiabank () is one of North America’s premier
financial institutions, with about $275 billion in assets and approximately
52,000 employees worldwide, including affiliates. It is also Canada’s most
international bank with more than 2,000 branches and offices in over
50 countries.

“The Scotiabank project represents a significant accomplishment for SCTN
and a major advance for the international smart card industry. In line with
SCTN’s long term vision, this project brings payments and loyalty programs
together on a single chip, allowing consumers to carry one card capable of
immediately receiving and redeeming incentive credits through purchases at
physical or online merchant locations,” stated Jim Williams, SCTN President
and CEO.” SCTN’s experience operating the longest running U.S. smart card
loyalty and cause-related marketing program has taught us that consumers and
merchants demand a single secure card for all payments and loyalty
applications.”

The pilot program under development will be launched early next year in
the region around Barrie, Ontario and more than 12,000 Scotiabank customers
will participate. Scotiabank will employ its vision for smart cards in
Canada, while testing the applicability of international and Open Platform
standards in Canada. Current Scotiabank customers can sign up for the smart
card pilot by contacting local branches in Barrie or Angus.

About The Alliance

The Solstice Project alliance was announced in May 2001 and is comprised
of six companies from around the world, each delivering a critical component
to the project. Oasis Technology provides software to facilitate merchant and
card accounting, switching and settlement in addition to a virtual credit
card. Giesecke & Devrient provides its smart card, including embedding and
fulfillment; Public Key Infrastructure (PKI) card applications, security
modules and microprocessing knowledge. Silverline’s CIT ePayments Division
provides PKI security server expertise, on/offshore development, systems
integration and implementation services. Smart Chip Technologies provides its
patented multi-platform smart chip loyalty application and Cardis provides the
micropayments engine capability. Ingenico will supply point-of-sale (POS)
devices and support systems.

About Smart Chip Technologies

Smart Chip Technologies (OTC: SCTN) is a Software Technology Company with
a patent protected loyalty application for use in the smart card and wireless
environment. SCTN licenses its patented e-llegiance(TM) multi-platform smart
chip loyalty application that is engineered for EMV, Global Platform, and
MULTOS compliance. The software is designed to operate on smart cards, POS
terminals, and other smart devices, such as PDA’s. SCTN also provides
complete loyalty program management, transaction processing, and accounting
services through its LoyaltyCentral(TM) software and back office operation.
The e-llegiance(TM) and LoyaltyCentral(TM) solutions provide maximum
flexibility in the management of click-and-mortar incentive programs,
establishing business continuity across the physical, mobile, and virtual
worlds. ()

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POSTGIROT ACQUIRED

Nordea announced it is acquiring Postgirot Bank for SEK 4.1 billion (EUR
440 million). As a result, Nordea will expand its customer base in Sweden
through Postgirot Bank’s 1.3 million customers, who will be offered
Nordea’s full range of financial services. Postgirot Bank holds a
significant position in the Swedish payment market. During the year 2000
Postgirot Bank’s average
deposits totalled EUR 3.8 billion and average customer loans totalled
EUR 1.2 billion. Postgirot Bank’s total assets amounted to EUR 7.7 billion
at the end of 2000.

— Nordea acquires Postgirot Bank in Sweden and strengthens its
competitiveness in important growth areas, such as payments and cash management

— Nordea expands its customer base in Sweden through Postgirot Bank’s 1.3
million customers, who will be offered Nordea’s full range of financial
services

— Nordea’s and Postgirot Bank’s products and services complement each
other, thereby strengthening Nordea’s position in the Nordic region

— The customers of Nordea and Postgirot Bank will get improved payment
services and a very broad range of qualified banking services

— The purchase price amounts to SEK 4.1 billion (EUR 440 million)

Expanding in a growth area

The market for payments is rapidly growing and changing by means of
the introduction of new techniques and payment systems. Efficient cash
management solutions are becoming increasingly important to Nordea’s
customers. Postgirot Bank holds a significant position in the Swedish
payment market and through the acquisition Nordea will improve its
position. The acquisition has three main attractions:
— Strengthened competitiveness in domestic payments.
Postgirot Bank is an important supplier of high-quality
paper-based and electronic payment services in Sweden (see
enclosed facts). Postgirot Bank has successfully developed
a number of electronic services, the quality of which is
very high, even in an international context. The company’s
systems and customer relations with a large number of
Swedish companies are important for creating an efficient
payment system. Combining the competencies of Nordea’s
e-services in Solo and Postgirot Bank will create better,
faster and more efficient payment services for the
customers, especially in the cash management area.
— Increased business volumes. The acquisition provides
excellent opportunities for cross-selling to Postgirot
Bank’s 1.3 million customers, of whom approximately 70% is
not Nordea customers today. The customers will be offered
a broad range of high-quality financial products and
services, and this is expected to generate additional
business volume, for instance through increased loans and
deposits. During the year 2000 Postgirot Bank’s average
deposits totalled EUR 3.8 billion and average customer
loans totalled EUR 1.2 billion. Postgirot Bank’s total
assets amounted to EUR 7.7 billion at the end of 2000.
— Strengthened competitiveness in international payments.
Postgirot Bank has a well-developed system for
international payment transfers, for instance through its
cooperation with the postal giro systems in other European
countries. Together, Nordea and Postgirot Bank can offer
their customers additional channels for payments. As a
result of the acquisition, payments from Nordea’s
customers in the other Nordic countries to all major
companies in Sweden can be effected faster.

“The acquisition of Postgirot Bank is an excellent growth opportunity
that will further strengthen our position as the leading financial services
group in the Nordic and Baltic Sea area. Customers will get better and
faster service on payments. Furthermore, we ensure that Swedish customers
will continue to benefit from alternative solutions for their payments,”
says Thorleif Krarup, Group CEO of Nordea.

Postgirot Bank will form part of the largest Nordic financial
institution with significant resources for further development of products
and services.

“Postgirot Bank, Nordea and all our customers are all winners. I am
very pleased that it is Nordea that has chosen to acquire Postgirot Bank.
We complement each other well, and this will mean benefits for Postgirot
Bank’s and Nordea’s customers,” says Postgirot Bank’s CEO Per-Eric Skotthag.

Financial effects

The acquisition is made at a cash price of SEK 4.1 billion (EUR 440
million) plus the net profit generated from 1 January 2001 up until
completion of the transaction. The goodwill arising as a result of the
acquisition is estimated at approximately EUR 215 million, including
restructuring costs of some EUR 20 million, to be amortised over ten years.
The annual net synergies from the acquisition are estimated at EUR 20
million after three years. The cost synergies have been calculated at EUR
30 million. The revenue synergies, including both cross-selling gains and
potential revenue losses, are calculated to be negative based on a
conservative estimate. Already in the first year, the acquisition is
expected to have a positive impact on earnings per share, after goodwill
amortisation. The effect of the transaction on Nordea’s Tier 1 capital
ratio is marginal, some 0.2 percentage points.

The acquisition, which will formally be made by Nordbanken AB, is
subject to approval by the Swedish Financial Supervisory Authority and the
EU Commission. Closing is expected in 2-6 months, depending on necessary
approvals.

Facts about Postgirot Bank

Postgirot Bank has conducted payment activities since 1925. Its
banking business started on March 1, 1994 in connection with the conversion
of Posten into a public limited company.

Services offered include domestic inpayment (collection) and domestic
outpayment products (invoice), cash pools for corporate cash management,
electronic invoicing and international payments. Postgirot Bank also offers
other products, such as card-based payments products, and has developed
several e-services such as ePostgiro, eFaktura and eKop.
Postgirot Bank provides basic banking services, including deposits
and overdrafts and short-term money market loans. Postgirot Bank has no
branches for teller services, but is offering this service through the
Swedish Post.

Postgirot Bank’s primary business is based in Stockholm. Furthermore,
production takes place in Tierp, Norrkoping and Malmo. Customer service and
call centre functions are in Eskilstuna. The sales staff are located in
around 20 cities in Sweden.

Postgirot Bank has 450,000 corporate customers and 850,000 personal
customers.

Details

ACTIVCARD 2Q/01

ActivCard S.A., a world-leading enabler of
digital identity for network computing, reported that net revenue for
the quarter ended June 30, 2001 increased 121% to a record $8.5 million from
$3.9 million in the second quarter of 2000.

Net loss for the quarter ended June 30, 2001, including non-recurring
charges, was $2.7 million, or $0.07 per diluted share, compared to net income
of $902,000, or $0.02 per diluted share, in the comparable period of 2000.
“We are pleased with our strong year-over-year growth, which continues to
be ActivCard’s primary focus,” commented Jean-Gerard Galvez, Chairman and
Chief Executive Officer. “Despite current economic conditions, we achieved
our top line goal and executed in accordance with plan. During the quarter,
we expanded our initial agreement with the Defense Manpower Data Center
(“DMDC”), licensing additional features and functionalities related to card
issuance capabilities. Leveraging this strategic win within the Department of
Defense (“DOD”), we entered into agreements with three departments during the
quarter. These departments are deploying ActivCard Gold, our market leading
Common Access Card (“CAC”) compliant client software. We continue to pursue
other significant global opportunities for large scale deployment of
government and enterprise identification cards and commercial and consumer
banking cards.”

During the quarter, ActivCard announced its collaboration with Precise
Biometrics to deliver the world’s first Open Platform-based, Match-On-Card
biometric authentication. The new solution integrates ActivCard’s digital
identification technology with Precise Biometrics’ fingerprint identification
technology, creating a highly secure platform ideal for companies seeking a
multi-factor authentication solution.

On July 5th, the Company announced the completion of its acquisition of
Safe Data System, a developer of user authentication software based in
Montpellier, France. The acquisition of Safe Data will enhance ActivCard’s
expertise in Microsoft and Checkpoint technologies and will bring additional
features to ActivCard’s packaged authentication server solution.
“Global corporations and government agencies continue to migrate to
digital identification provisioning solutions to provide increased security,
operational efficiency and compelling return-on-investment,” stated Blair
Geddes, Chief Financial Officer. “Over the past few months, ActivCard has
expanded its strategic position within the digital identification market
through partnerships and acquisition. Our actions this quarter complement our
strategy of collaboration and solution interoperability with large network
computing and communications companies such as Hewlett Packard, Microsoft,
Novell, and Sun Microsystems. ActivCard has positioned itself to capitalize
on the growing opportunity as the market for digital identity solutions
evolves.”

The search for a new Chief Executive Officer continues to progress. The
Company expects to announce the hiring of a new Chief Executive Officer within
the next few months. In the meantime, the executive management team will
continue to ably manage the day-to-day operations of the Company.
For the six-month period ended June 30, 2001, ActivCard reported revenue
of $15.6 million, compared to $7.0 million in the six-month period ended June
30, 2000. Net loss for the first six months of 2001 was $3.0 million, or
$0.08 per diluted share, compared to net income of $3.6 million or $0.09 per
diluted share, in the comparable prior year period. Pro forma net loss for
the first half of 2001, excluding non-recurring items and net foreign currency
transaction gains, was $2.7 million, or $0.07 per diluted share, compared to a
net loss of $1.6 million, or $0.04 per diluted share, in the first half of
2000.

Third Quarter and Fiscal 2001 Outlook
For the third quarter, 2001, the Company anticipates continued sequential
growth with revenues ranging between $10.0 million and $11.0 million.
ActivCard’s objective for the full year 2001 continues to be revenue growth of
100% to 120% from fiscal 2000.

About ActivCard

ActivCard, a leader in digital identity and electronic certification
technology, delivers core components required to enable next generation
e-Business communication and transactions. The ActivCard technology suite
offers the ease-of-use of an ATM transaction with a security level better than
face-to-face meeting. ActivCard solutions, in conjunction with the
applications support for public key based data confidentiality and integrity,
allow individuals and businesses to perform secure online transactions over
the Internet. Today, more than 2 million people use ActivCard products for
secure Internet banking, Web access and remote access to corporate networks.
ActivCard is headquartered in Fremont, California, with worldwide operations
in France, Germany, Japan, Sweden, Singapore and United Kingdom.

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$1 Smart Cards

Eliminating the pricing gap between mag stripe and smart cards, VISA International announced this morning a deal to provide issuers with EMV-compliant smart cards that cost less than one U.S. dollar. For U.S credit card issuers, the development is the most significant to-date, and opens the way for VISA issuers, regardless of size, to migrate quickly to smart cards. The new $1 smart cards, developed in partnership with IBM, will be the first in a family of low cost products from STMicroelectronics. The new sub-one dollar smart card will be manufactured by Orga, although other manufacturers are currently negotiating with VISA to join the program. Last September, VISA introduced a multi-application ‘Open Platform card’ costing less than three U.S. dollars and, in May, announced two new ‘Open Platform’ card products, one with enhanced data authentication capability for less than four U.S. dollars and one with a contact/contactless dual interface capability for less than five U.S. dollars. Five card vendors offer multi-application smart cards under three dollars, including Giesecke & Devrient, Orga, Dai Nippon, Oberthur, and Schlumberger. The low-cost enhanced and dual interface smart cards are produced by Giesecke & Devrient and Orga. (CF Library 9/12/00; 5/17/01)

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