Concord EFS 3Q/99

Concord EFS, Inc. reported yesterday record financial results for the third quarter of 1999. Third quarter revenue increased 29% to $216.1 million when compared to the same period of the prior year. Net income for the third quarter was $35.6 million or $0.17 diluted earnings per share, increases of 50% and 42%, respectively, over same period of the prior year.

Historical results include the results of Electronic Payment Services, Inc. which was acquired by Concord EFS, Inc. on February 26, 1999 and accounted for as a pooling of interests. Additionally, during the third quarter of 1999 the Board of Directors approved a three for two stock split which was distributed on September 22, 1999. Earnings per share and related per share data have been restated to reflect the stock split.

For the nine months ended September 30, 1999, revenue increased 27% to $580.1 million. Excluding acquisition and restructuring charges incurred in the first quarter of 1999, nine month net income was $88.9 million or $0.44 diluted earnings per share, up 42% and 38%, respectively, when compared to the same period of the prior year. The charges, which were incurred in association with the merger of Concord EFS, Inc. and Electronic Payment Services, Inc., totaled $26.9 million, net of taxes, or $0.13 diluted earnings per share. Including the charges, net income was $62.0 million or $0.30 diluted earnings per share for the nine months ended September 30, 1999.

Concord is a vertically integrated electronic transaction processor, providing transaction authorization, data capture, settlement and funds transfer services to selected markets. Concord’s primary activities include providing credit, debit, check authorization and electronic benefits transfer (EBT) processing services to supermarket, petroleum, convenience store and other retailers; and providing gateway processing, ATM driving and MAC(R) network access to the financial services industry. Concord also provides electronic payment and payroll services to trucking companies, truck stops and other niches of the market.

For more information on Concord EFS 3Q/99 visit CardData ([][1]).



Wachovia 5 Min Loans

Wachovia’s Internet web site at [][1] now offers one of the most extensive online resources for consumers seeking answers to their credit needs.

Four new online application processes were added to the site this month. Consumers can apply online in approximately five minutes for a home equity line of credit, personal line of credit, home equity loan or personal installment loan.

After submitting an application, the consumer receives a username and password for privacy protection and is sent an e-mail verification that the application has been received. Normally within one business day, a second e- mail is received that directs the consumer back to the site. By visiting the Web address provided and entering the username and password, the applicant then can learn whether the loan has been approved and receive additional information.

“Delivering Wachovia’s credit services online provides a quick and efficient channel for customers,” said Thomas W. Trotter, head of Wachovia’s Consumer Credit Services. “The web site brings the bank to customers in a convenient way, 24 hours a day, seven days a week, from any physical location with a computer connected to the Internet.”

The web site also provides a six-question worksheet to help consumers determine the right credit product for their borrowing needs and preferences. Additional information is provided on each type of credit product, including a product summary and the most common uses. Additional calculators are provided to help answer related credit questions.

The four new online applications join application forms and information previously available on the web site for mortgage loans, auto loans and credit cards.

“We believe the web site is one of the most extensive resources for assisting consumers with financial needs that is available today among banking sites, including the new Internet banks that provide services exclusively online,” said Lawrence G. Baxter, head of Wachovia’s Digital Financial Services.

Wachovia Corporation is a leading bank holding company with Wachovia Bank, N.A. its principal subsidiary. At Sept. 30, 1999, Wachovia had assets of $65.8 billion. Wachovia Bank, N.A. has more than 700 offices and 1,300 ATMs in Florida, Georgia, North Carolina, South Carolina and Virginia.



Credit Drives Profits

Credit card revenues continue to drive profits at Sears even as retail sales and gross margin continue to soften. Sears, Roebuck and Co. reported Thursday third-quarter total operating income of $429 million, a decline of more than 10% from 3Q/98. However operating income from Sears’ credit card business rose 5.7% to $316 million. International operating income rose about 56%, but all other categories declined significantly. Retail operating income declined more than 51%, services operating income declined nearly 19% and operating income from corporate activities declined more than 30%, compared to 3Q/98. Even though credit operating income increased, Sears average managed credit card receivables have declined significantly over the past twelve months, from $27.6 billion to $26.0 billion. But credit quality continues to improve as chargeoffs declined to 6.39% for 3Q/99 compared to 7.20% for 3Q/98. However delinquency (30+day) inched up from 7.29% for 3Q/98 to 7.57% for 3Q/99. Sears net interest margin also declined from 14.17% for 3Q/98 to 13.52% for 3Q/99. For complete details on Sears’ 3Q/99 visit CardData ([][1]).



Metris & Priceline

Metris Companies Inc. said today that it has signed a marketing agreement with Under the agreement Metris will offer its DirectAlert credit monitoring service to customers in return for helping them save money on leisure airline tickets and hotel rooms purchased through the popular name-your-own-price Internet service.

DirectAlert enables consumers to monitor changes in their credit bureau report through the automatic delivery of quarterly activity reports. DirectAlert is one of several consumer products and services marketed by Metris Direct Services Inc., a Metris subsidiary.

Under the agreement, Metris is joining’s “sponsor dollars” adaptive marketing program designed to help customers get leisure airline tickets and hotel rooms at their price through Each time a customer applies for a DirectAlert membership, up to $20 in sponsor dollars is added to the customer’s ticket or hotel room price request. Adding sponsor dollars increases the total amount of a price request at no cost to the customer, increasing the likelihood that a major airline or hotel will accept the customer’s price.

“Our agreement with is an exciting opportunity for Metris,” said Metris President and CEO Ronald Zebeck. “We believe the Internet is an excellent delivery medium for our fee-based products and services. Our DirectAlert service is ideal for security-minded consumers who want to keep close watch on their credit records.”

Metris Companies is an information-based direct marketer of consumer credit products and fee-based services, primarily to moderate-income consumers. Metris Direct has sold its products and services to more than 4 million consumers holding credit cards, including credit cards issued by five of the top 10 card issuers.

Based in St. Louis Park, Minn., Metris also has operations in Phoenix, Ariz.; Jacksonville, Fla.; Champaign, Ill.; Baltimore, Md.; and Tulsa, Okla. Metris employs more than 3,000 people.

Visit Metris on the Internet at [][1] and [][2].



Explosive Western Union

First Data Corp. said yesterday that explosive growth in its international Western Union business contributed significantly to the company’s overall 3Q/99 earnings. FDC’s international money transfer revenues soared by more than 50%. The global network of Western Union agent locations grew to approximately 78,000, up 48% over the prior year, and now serves 176 countries. Most significantly, for the first time in the company’s history, the number of international agent locations (39,800) now exceeds the number of North American agent locations (38,100). Card Issuer Services worldwide revenues increased 11% in the quarter to $360 million. Total card accounts on file, including credit, debit, and retail cards, were up 24% over the prior year to more than 260 million. Merchant Processing Services continued to perform well with revenues up 12% in the quarter to $388 million and operating profits up 37%. Total merchant card dollar volume for the quarter grew 36%, including the results of Paymentech, First Data’s share of which was acquired July 27th and combined with the Bank One Alliance, creating one of the nation’s largest merchant processors. Excluding Paymentech, merchant dollar volume processed was up 19%. For more details on FDC’s current and past earnings please visit CardData ([][1]).



Irrational Pricing

While CT-based People’s Bank posted a significant 3Q/99 increase in the bottom-line profitability of their credit card business, the bank says “irrational pricing by some competitors” continues to challenge their ability to grow the portfolio at double-digit rates. Indeed many top issuers are widely offering 0% intro rates and 9.99% go-to rates for the current pre-holiday season. People’s average managed credit card portfolio increased $410 million or 12% compared to the third quarter of 1998 and was essentially unchanged from the second quarter of 1999. Managed credit card yield increased 11 basis points compared to 3Q98 and 17 basis points compared to 2Q99. Managed credit card fees increased $5.0 million, or 18%. Credit card net charge-offs (as a percentage of average managed receivables) equaled 4.12%, increasing 17 basis points compared to 3Q98 and 12 basis points compared to 2Q99. Delinquencies as a percentage of quarter-end managed receivables (2.88%) declined 15 basis points from 3Q98 and increased 30 basis points from 2Q99. FDC is holding a news conference this morning to review 3Q/99 results. For current and historical data on People’s Bank visit CardData ([][1]).



ID Fraud Settlements

The Federal Trade Commission reported yesterday that sixteen defendants targeted in a law enforcement crackdown on illegal credit repair services have agreed to settle federal charges that the file segregation advice and products violated federal law. The defendants used the Internet and other media to claim they could help consumers obtain new credit histories by obtaining new identification numbers through a practice known as file segregation. The firms sold instructions about how consumers could substitute federally-issued, nine-digit employee identification numbers or taxpayer identification numbers for social security numbers and use them illegally to build new credit profiles that would allow them to get credit they may be denied based on their real credit histories.


Customer Focus

Providian Financial said yesterday that declining call volume and customer complaints coupled with increased customer retention should help the company build a stronger customer. The sub-prime card specialist, which focuses on the “unbanked” consumer segment, has been dogged by cardholder lawsuits, shareholder lawsuits, and negative publicity. The San Francisco District Attorney’s Office continues to investigate Providian and a number of private lawsuits that have been filed in regard to the company’s sales and collection practices. Nevertheless, Providian opened over one million net new accounts during the third quarter. Total managed revenue increased by 79% over the third quarter of 1998 to $1.12 billion. Managed loans grew by $2.1 billion during the quarter and now total $18.4 billion, a 56% increase over the corresponding period in 1998. The net interest margin hit 12.40% and non-interest revenue increased to $560.6 million for the quarter. The managed net credit loss rate declined by 76 basis points from 7.16% in the second quarter to 6.40% during the third quarter. The 30+ day managed delinquency rate rose from 4.70% at second quarter end to 5.20% at the end of the third quarter. For current and historical data on Providian, visit CardData ([][1]).



Citibank Hong Kong Goes TPII

IFS International, Inc. announced that Citibank, NA Hong Kong Branch has licensed its TPII software to provide the Electronic Funds Transfer management system to support the Citibank SHKP Club Visa Card.

Citibank, NA Hong Kong Branch has licensed TPII in order to jointly launch with Sun Hung Kai Properties (SHKP) a significant upgrade to the successful Citibank SHKP Club VISA Card. This upgraded card is the world’s first commercial multifunctional smart card using Visa Open Platform (VOP) technology and Hong Kong’s first credit card to feature the Visa Cash function. Together with SHKP’s contact-less smart chip, this card is able to perform a wide array of new functions to enhance the level of convenience enjoyed by the cardholders.

TPII will manage card re-load devices throughout Hong Kong and will load electronic cash onto the Citibank SHKP Club Visa card electronic purse. The card also has a number of other value-added services, including a special loyalty scheme for six shopping malls, SHKP club membership and a Citibank credit card with access to 24-hour Citiphone banking and Home Emergency Protector.

An additional feature of the Citibank SHKP Visa Card is that residents of SHKP’s properties will be able to use the card to access their residential blocks and car parks. With the Visa Cash function incorporated, this card can also be used to pay for estate facilities, such as club house facilities, shuttle buses and restaurants within the property. TPII will enable funds to be loaded onto the chip at Visa Cash terminals located at the club house.

According to Citibank Hong Kong’s spokesperson, “With the Club Visa Card, customers will benefit from VOP’s groundbreaking technology combined with Citibank’s renowned service and credit card security. The card provides flexibility and a cost-effective way to respond quickly to customers’ needs. The aim with Sun Hung Kai Properties is to continue utilizing the advances of technology to offer unmatched life-enhancing benefits to the Hong Kong people.”

Paul Constable, Regional Director-Asia for IFS International added, “IFS is very pleased to be able to assist Citibank Hong Kong in this innovative smart card project. Citibank Hong Kong represents a significant addition to the IFS customer base not only as the first in Greater China but also because Citibank is a market leader in the issuance of plastic card products worldwide and a major force in retail banking in the Asian markets.”

About Citibank

Citibank, a major subsidiary of Citigroup Inc. (NYSE: C), is the most global of all financial institutions in the world with operations in 100 countries and territories, providing a full range of innovative financial products and services. Citibank was the first U.S. bank to establish operations in Hong Kong in 1902 and is today the largest U.S. bank in the territory. The bank was voted by Euromoney Magazine as the Best Foreign Exchange Bank (for 21 consecutive years), the Best Emerging Markets Bank and Best at Transaction Services in 1999. Citibank was also the leading multinational financial institution in Asia in 1998-99 for the sixth consecutive year in the Far Eastern Economic Review’s annual survey and was awarded IFP Asia’s Bank of the Year, and Finance Asia’s Best Foreign Commercial Bank in Hong Kong 1999.

About Sun Hung Kai Properties

Sun Hung Kai Properties has been a publicly listed Company since 1972. It is one of Hong Kong’s largest property developers, and its core business is the development of all different types of property in the territory, both for investment and sale. It also has a reputation for premium quality and comprehensive customer care. The Company’s property development business is supported by complementary activities such as mortgage financing, insurance and estate management, and it has drawn on its real estate expertise to diversify into other related areas such as infrastructure, transportation, hotels, car parks, godown operations and restaurants.

The Company was named No. 1 among Asia’s Best Managed Companies in 1997 by Asiamoney Magazine, one of Asia’s Most Admired Companies in 1999 by Asian Business Magazine and No. 1 Real Estate Developer for quality of service in 1999 by World Architecture Magazine.

About Visa International

As the “World’s Best Way to Pay,” Visa is the world’s leading payment brand and the largest payment system worldwide with more volume than all other major payment cards combined. Visa plays a pivotal role in advancing new payment products and technologies to benefit its 21,000 member financial institutions and their cardholders. Visa has more than 70 smart-card programs in 33 countries and on the Internet, with 23 million Visa chip cards, including eight million Visa Cash cards. Visa is pioneering SET Secure Electronic Transaction(TM) programs to enable and advance Internet commerce. There are over 850 million Visa, Visa Electron, Interlink, PLUS and Visa Cash cards, which generate more than U.S. $1.4 trillion in annual volume. Visa-branded cards are accepted at over 17 million worldwide locations, including at more than 500,000 ATMs in the Visa Global ATM Network. Visa’s Internet address is [][1].

About IFS International

IFS International, Inc. and Network Controls International, Inc. are divisions of IFS International, Inc. which has headquarters in the U.S.A. and subsidiary offices in the U.S.A., U.K., Singapore, Australia and Germany.

IFS International, Inc. develops, markets, and supports software products for the Electronic Funds Transfer (EFT) market. IFS International’s TPII suite of software products provide support for Automatic Teller Machine (ATM), Point of Sale (POS), network switches, smart-card, card management, bank teller platform, home banking and call-center solutions. NCI, Inc. provides complementary products, such as NCI Business Centre, an enterprise-wide retail bank branch solution designed to deliver traditional and Internet/Intranet- based transactions.


Details MasterCard

Bank of Montreal and newspaper publisher Hollinger International unveiled the ‘ MasterCard’ yesterday. It is the first co-branded credit card in Canada geared specifically for the online shopper. is an Internet portal and home of a Canadian online shopping mall. Cardholder benefits include free delivery or 10% off the retail price of goods purchased online at participating online retailers and the opportunity to earn ‘AIR MILES’ on every card purchase. Bank of Montreal is offering customers a choice of interest rate, annual fee and loyalty program. Cardholders may choose from a no fee MasterCard with an 18.40% interest rate, or a 13.9% interest rate MasterCard with a $15 annual fee. Cardholders can also opt for the ‘AIR MILES’ rewards program. For the 18.40% card with ‘AIR MILES’ the annual fee is $35. The lower 13.90% card with ‘AIR MILES’ requires a $50 annual fee instead of the basic $15 annual fee. Consumers may apply online for the new cards. Hollinger International Inc., which owns, also owns 74 paid daily newspapers including the Chicago Sun-Times and the Ottawa Citizen and National Post in Canada.


Chase No Slouch

Chase Manhattan also reports this morning a 16% increase in card fee income and a significant drop in delinquency and chargeoffs. For the third quarter Chase generated $441 million in non-interest credit card revenue compared to $381 million for 3Q/98. Through Sept. 30, Chase’s card fee revenue totaled $1,258,000,000, a 20% increase over the first nine months of 1998. Delinquency (90+ day) was 1.80% for 3Q/99 compared to 2.14% for 3Q/98. Chargeoffs, as a percentage of average receivables, came in at 5.53% for the third quarter compared to 6.19% one year ago. Total average managed receivables, which includes domestic and international cards, was $32.9 billion at the end of the third quarter. For complete current and historical statistics on Chase Manhattan’s card portfolio visit CardData ([][1]).



Metris Banner Quarter

Metris Companies, a sub-prime card issuer and fee-based services provider, turned in impressive quarterly numbers once again. CEO Zebeck and gang, report this morning that credit card fee income is up 58%, card volume is up 38%, fee-based services revenue is up 63%, and overall net income is up 83%. Chargeoffs and delinquency also declined over the past year. Managed credit card fees, interchange and other credit card income increased to $104.1 million for the third quarter, compared to $65.8 million in the third quarter of 1998. Through Sept. 30, Metris’ card fee income totals $268.1 million. Credit card charge volume for 3Q/99 was approximately $1.5 billion compared to about $1.1 billion for 3Q/98. Metris added 800,000 new fee-based relationships during the third quarter, largely from its ‘PurchaseShield’ debt waiver product. Revenues from all fee-based services revenues increased to $44.6 million for the third quarter of 1999 compared to $27.4 million for 3Q/98. The 3Q/99 managed net charge-off rate was 8.8% compared to 10.1% for the prior quarter and 10.5% for the third quarter of 1998. The managed 30+ day delinquency rate stood at 7.5% on Sept. 30, compared to 6.3% on June 30, and 7.8% on Sept. 30, 1998. During the third quarter Metris experienced fraud losses of $1.7 million. For complete current and historical statistics on Metris companies visit CardData ([][1]).

3Q/99 2Q/99
Receivables: $6,685,075,000 $6,452,657,000
Q Volume: $1,539,563,000 $1,290,188,000
Accounts: 4,895,000 4,167,000
Actives: 3,161,000 2,628,000
Cards: 6,216,000 4,991,000

Source: CardData (