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R.K Hammer, Investment Bankers, has released their First-Half Year 2000 study results of performing credit card portfolios sold. The number, dollar value, and premium prices of recent industry deals have continued to rise from 1999 levels.

First-Half, 2000 Credit Card Portfolio Transactions

# of Card Deals Identified 19
Underlying Assets Sold $4.85 Billion
Average Size Deal $255 Million
Total Accounts Sold 4.86 Million
Average Accounts Sold 255,000
Average Premium above Par 16.97%
Range of Premiums 5.0%-25.3%
Ave. Cost/Acquired Acct. $158
Range of Cost/Acquired Acct. $51-$288
Average OROA Earnings 3.20%
Pre-tax Earnings Multiple 5.30x
%of Deals Done by Advisors 78%
%of Deals done “In-house” 22%

First-Half Notes

Average premiums were up 3.4% from 1999 year-end (16.97% vs. 16.42%). Rising transaction prices were again largely due to improved credit quality. Value of advisor-led deals: 53% greater average deal premium than for “In-house.” An additional $6.5 Billion in deals are also in the pipeline at the start of the 3Q.



Wireless data and electronic applications should become increasingly popular in the future according to a new report by Frost & Sullivan. The wireless Internet is following the same development pattern as wired internet. Advances in wireless communication technologies are basically extending the Net to a variety of portable devices and appliances such as cellular phones and pagers and palmtop computers. F&S says competition has resulted in the wireless infrastructure becoming cheaper. There are about 70 million cellular phones in the US alone. The cell phone total is in the same range as television subscribers, as well as personal computers. F&S says per-minute pricing has declined considerably over recent years. The average cost per minute has been estimated to range from $0.12 to $0.15, down from prices of more than $0.20 two years ago. Frost & Sullivan believes that the wireless revolution will be driven in the short term by the “anytime anywhere access”.


Flooz signed agreements last week to feature has pioneered a unique method of gift giving by combining e-mail and electronic greeting cards with a stored value platform. Parents or grandparents can purchase ‘Flooz’ with a credit card and then instantly send it by e-mail to their kids for redemption. Kids can then spend their ‘Flooz’ at or reserve it in their personal Flooz account for use at a later time. Recipients can also spend ‘Flooz’, which is accepted as a branded form of payment, at more than 70 online stores including: Barnes & Noble, Starbucks, Tower Records, Godiva Chocolatier,, and


MULTOS Asian Smart Card

MULTOS,  the  secure,  multi-application  operating system, has been selected by Cable  &  Wireless Hong Kong Telecom SecureNet for the first commercial release of a multi-application smart card in the Asia Pacific region.

C&W  HKT  SecureNet  is  a joint venture company between C&W HKT and Australia’s leading Internet security provider SecureNet Limited.

As  part  of  a  number  of  initiatives developed by Cable & Wireless Hong Kong Telecom and the Hong Kong and Shanghai Banking Corporation to encourage  the  growth  of  e-commerce  in  Hong Kong, over 50,000 cards will be initially  issued  throughout the territory.  The card will include a digital ID certificate,  e-cash,  credit/debit  and  a  loyalty program and will run on the smart-card platform MULTOS which is managed by the consortium MAOSCO.

Geoffrey  Ross,  managing director of SecureNet, said:  “We chose MULTOS because of  its high security standards and multi-functional capabilities. MULTOS allows products (in the form of applications) to be added to and deleted from the card. The  benefit  of the pre-loaded applications means the smart card is ready to be used  once  plugged  into  the  PC  and  doesn?t  require special software to be installed.”

The smart card will enable consumers to shop online using their credit, debit or electronic  cash card without having personal details exposed over the Internet, making e-commerce easier and more secure.

The  cards  will  also  support an Internet-based loyalty program, where loyalty points  will  be  accumulated  and stored on an Internet server for customers to purchase and redeem goods online from a number of merchants.

The  cards  use  SecureNet’s latest Internet-based and Public Key Infrastructure (PKI)  technology  to underpin Hong Kong’s burgeoning e-commerce industry. It is expected  the  facility  will  gain  in  popularity  as more and more people use digital  certificates  as  a  trusted means of identifying, signing and securing their internet and email transmissions.

Ross  concludes:   ‘The development of a multi-application card on MULTOS offers enormous  advantages.   Customers  can choose to buy new applications or discard old  ones  and  can  remotely  load  and delete applications through their PC or public kiosks.’


MULTOS  is  a  secure, multi-application smart card platform. It allows products (in  the  form  of applications) to be added to and deleted from the card. Third party  software  developers  can develop their own MULTOS applications, allowing them to tailor design Value Added Services for the card user.  Such applications include  loyalty,  ticketing,  credit,  debit  and  electronic purse. MULTOS was launched  in  May  1997  and  has  met a great success in the financial services industry.  More  recently, combined with PKI applications, MULTOS has become the basis of a number of world leading e-commerce initiatives.

MAOSCO  is  a  world-wide  consortium which was formed to drive the adoption and manage  the  on-going development of MULTOS as an industry standard platform for smart  cards.  Members  of  the  consortium  include  American Express, Discover Financial   Services,   DNP,   Europay  International,  Fujitsu  (including  its subsidiaries   ICL   and  Amdahl),  Giesecke  and  Devrient,  Hitachi,  Infineon Technologies  (a  subsidiary  of Siemens), Keycorp, MasterCard International and Mondex   International,  Motorola  and  Telstra.  For  further  information  see [][1]

About SecureNet Limited SecureNet’s  key  business is supplying data security solutions to corporate and government  organisations,  including  the  banking  and  finance sectors.  With worldwide  e-commerce  forecast  to  grow  by  more than 130 per cent per annum, SecureNet  sees  its role expanding as a forefront provider of Internet security services and equipment.

SecureNet  specialises  in  the development, design and installation of complete security   solutions,   addressing   the   Internet,  remote  banking,  VPN  and data-critical   applications.    An   industry  specialist  in  smartcard,  PKI, firewalls,  secure  payments  and  security  consultancy, SecureNet has become a trusted  name  in  integrated high-technology security products and services. It also  provides  consultancy  and  custom design and solution services for a wide range of IT applications. Web Site: [][2]



CyberCash 25,000

CyberCash, Inc. announced it has signed up the 25,000th merchant for its industry leading CashRegister Internet payment service.

The addition of to a merchant base that includes, and highlights CyberCash’s continued success in providing industry leading Internet payment services and software.     CyberCash also announced that it has entered the second stage of beta testing for its fraud detection service.  Fraud detection will be generally available in the 3rd quarter of 2000.

“Signing up our 25,000th merchant is an important milestone for CyberCash, underscoring our ability to grow our Internet payment business in a powerful and consistent way.  In the past five months, we have signed up 5,000 new merchants — and couldn’t be more pleased to welcome fast-growing Internet companies like to the CyberCash family,” said James J. Condon, President and Chief Executive Officer of CyberCash.

“ provides new and expecting parents with convenience and peace of mind when they shop online.  We want to ensure that when they make an online purchase at their payment is processed quickly, efficiently and securely.  CyberCash is our answer,” said Preston Bealle, President and Chief Executive Officer of

CyberCash has experienced enormous growth as the leading provider of payment processing services to the exploding Net economy.  Its Internet merchant base has almost doubled in the past year to 25,000.  In addition, CyberCash continues to be a premier source of software for both Internet and physical world payments.  More than 145,000 copies of CyberCash software products have been shipped., CyberCash’s 25,000th merchant, is the largest and fastest growing e-commerce site for baby products.  It can be found at  For more information about CyberCash products, services and partners, visit the company’s Web site at [][1].

About CyberCash

CyberCash, Inc., is the world’s leading provider of Internet payment services and electronic payment software.  The company uniquely provides services to 25,000 Internet merchants and has shipped more than 145,000 copies of its software products.  CyberCash offers the broadest reach in the payment industry with a comprehensive distribution network that includes direct and indirect sales as well as marketing partnerships with financial institutions, Internet service providers, application service providers, storefront solution providers and leading independent software vendors.

About is the largest and fastest-growing e-commerce site for baby products on the Internet today.  Offering the largest selection of baby products in one place from more than 100 trusted national brands, the site offers a streamlined approach designed to make life easier for new and expecting parents, and can be found at [][2].


Details Prez has hired Gretchen H. Bender to the position of President, where she will oversee all operations for the company.

PAIDCard (Prepaid Anonymous Internet Debit Card) is the latest initiative in secure retail and electronic commerce transaction processing. Preliminary market tests show strong acceptance, as the company will go to full market September 1st and will be publicly traded on NASDAQ symbol PDCD.

Ms. Bender comes to PAIDCard from First Bank of Beverly Hills, a subsidiary of Wilshire Financial Services Group (NASDAQ), where she served as Operations Manager in charge of all merchant acquiring activity for the Bankcard Division. Gretchen and her staff serviced a portfolio of nearly 9,000 merchants in the nation’s 48th largest credit card processor.

She was also instrumental in developing and enhancing the Bank’s relationships with CyberCash (NASDAQ), Signio, a division of Verisign (NASDAQ), First Data Resources (NYSE) and NDC e-Commerce (NYSE).

Prior to First Bank of Beverly Hills, Gretchen operated DataBank International, Ltd., a third-party service organization for the Bank of Los Angeles. She was responsible for portfolio profitability and guided DataBank in its development of an international processing solution and additional third party relationships.

Ms. Bender is a Business Administration graduate with a major in Management Information Systems, 1990, from the University of Arizona.

Gary Davies, Chairman of PAIDCard, said, “We are delighted to have an executive with Ms. Bender’s impressive abilities, banking and solid credit card experience with a working knowledge of our specific area of business. She brings with her a world of savvy that we will need to move forward quickly.”

PAIDCard will be available at retail locations and convenience stores nationwide, as well as over the internet. International distribution of the PAIDCard will be developed through affiliate banking relationships and foreign agents.

About, Inc. is an internet banking services company functioning as an agent while finalizing contracts to become a registered sales organization for the processing of MasterCard and Visa transactions. Through their relationships with various banking institutions and with third party processors, the company is able to utilize the Federal Reserve’s Automated Clearing House (ACH) system to deposit and collect funds electronically. Given these capabilities, the company has introduced its own private label card known as PAIDCard (Prepaid Anonymous Internet Debit Card).

The PAIDCard advantage is its ability to alleviate the burden of chargebacks from online and retail merchants, while providing anonymity to the consumer. Fraud is substantially reduced with this method of payment, thus greatly lowering merchant fees and driving added, unexpected revenue to participating e-commerce and retail clients.


Canadian PGA MasterCard

Bank of Montreal MasterCard and the Canadian Professional Golfers’ Association have teamed up to create a value packed MasterCard offering for golfers.

The new Canadian PGA Bank of Montreal MasterCard is available immediately to all members of the Canadian PGA, as well as golf afficionados all over Canada. When using the card for purchases, the Canadian PGA cardholder will be entitled to such benefits as discounts on golf lessons, green fee discount books and Ultimate Golf Vacations.

“Every golfer will want a Canadian PGA Bank of Montreal MasterCard,” said Canadian PGA Chief Executive Office, David Colling. “In addition to the valuable discounts and benefits that cardholders will receive, a portion of the card’s revenue will be used to support junior activities of the Canadian PGA. We are extremely excited about this venture and feel it has tremendous potential.”

With over five million golfers in Canada, the golf participation rate per capita is higher in this country than anywhere else in the world.

“Affinity cards are a terrific way to support non-profit organizations and charitable causes,” said Michelle Field, Vice President, Bank of Montreal MasterCard. “Bank of Montreal MasterCard has over 200 different affinity cards with charitable, academic, athletic and cultural organizations, allowing consumers to choose a card tailored to their own individual interests and needs.”

The Canadian PGA is a membership-based, non-profit organization representing over 3,000 club professionals and tournament professionals across Canada. It is committed to improving and promoting the game of golf by providing the golfing public and the Canadian PGA-approved facilities with the highest quality administrators, teachers, players and promoters of the game, through superior training, education and member development.

Bank of Montreal is the largest issuer of MasterCard cards in Canada. Serving five million customers across the country, Bank of Montreal MasterCard is also the largest card issuer of the AIR MILES(R)+ Reward Program and the only credit card in Canada to offer the FirstHome(R) Program. In addition to Platinum, Gold, US Dollar, student, and low-interest options, Bank of Montreal MasterCard offers co-branded cards with, Star Trek and Shell.


Vatican Cards

Los Angeles-based Maxx International yesterday announced that it signed the first-ever exclusive license agreement with the Treasures of St. Peter’s in The Vatican. The agreement provides Maxx with the exclusive rights to market and distribute Vatican-branded credit, debit and telephone cards. The deal will also seek to develop the first affinity card specifically for the approximate 60 million Catholics in the USA and over one billion Catholics worldwide. Maxx says it is in discussions now with several bank credit card issuers. Maxx will also have rights to sublicense and manufacture pre-paid and post-paid calling cards that carry an imprint of an image of the art works contained in the Vatican Treasury.


Bankruptcy Decline

The number of personal bankruptcy petitions filed in U.S. federal courts has been dropping by an annual rate of 8.3%. According to CardData, the percentage of chargeoffs involving bankruptcy has declined from 42.3% for May 1999 to 37.2% for May 2000. The Administrative Office of the U.S Courts recently reported that personal bankruptcy filings have dropped from 1,378,071 for the year ending 3-31-99 to 1,263,096 for the year ending 3/31/00. For the first quarter 2000, there were 312,335 total bankruptcy filings compared to 330,784 for 1Q/99. For complete bankruptcy statistics visit CardData (

(for year ending March 31)
2000 908,802 381,568
1999 1,017,049 393,245
1998 1,007,213 404,749
1997 862,136 372,369
1996 665,310 300,901
1995 568,565 255,382

Source: Administrative Office of the U.S. Courts


Delta – Amex Renew

Delta Air Lines and American Express Thursday announced an agreement to extend their long-term partnership. The deal involves the cobranded ‘Delta SkyMiles’ credit cards and participation of Delta Air Lines in the ‘Membership Rewards’ program. The co-branded credit card was introduced in 1996. In 1991, Delta became one of the first partners in the AmEx ‘Membership Miles Program’, now ‘Membership Rewards’. The program now has more than 8 million enrollees worldwide. The Delta Air Lines co-branded program is now the third largest co-branded airline mileage in the US following the United Airlines and American Airlines programs.


Down Month

All credit card statistics for card bonds declined during May according to the Fitch ‘Credit Card Index’. While the good news is that chargeoffs and delinquency declined the bad news is gross yields also declined during May. The Fitch database of $214 billion of credit card-backed securities shows the 60-day delinquency rate is now at its lowest level since Aug 1996. Chargeoffs also dipped to the lowest level since the start of this year.

May00 5.38% 18.44% 15.47% 2.89% 5.47%
Apr00 5.43% 19.72% 17.34% 3.01% 5.62%
Mar00 5.50% 19.30% 16.05% 3.21% 5.52%
Feb00 5.45% 18.48% 16.36% 3.06% 5.53%
Jan00 5.53% 19.36% 16.71% 3.17% 5.89%
May99 5.91% 18.65% 15.96% 3.02% 5.64%
CO-chargeoffs; GY-gross yield; MP-monthly payment rate; DL-60+ day
delinquency rate; SP-3-month excess spread

Source: Fitch IBCA Credit Card Index


ATM Gold

Arkansas Federal Credit Union wanted to raise its maximum ATM transaction amount from $300 to $500 but was concerned about the increased frequency of reloading its machine. The solution was found in dispensing the new Sacagawea golden one dollar coin which freed up a note dispenser for $50 bills.The credit union is the first financial institution in the country to dispense the newly minted, golden one dollar coin at an ATM.