Lipp to Head Citi Global Consumer

Citigroup announced Friday that William I. Campbell, Co-Chief Executive Officer of the Global Consumer Group, has decided to retire later this year.

“When I joined Citicorp in 1995, I wanted to help bring the Consumer Group to a new level,” Mr. Campbell said. “The momentum behind our great progress was accelerated by our October merger with Travelers, which enabled us to establish, in one transaction, greater efficiency, broader product diversification and the ability to cross-market products globally through expanded and varied distribution channels. With clear evidence of the success of our merger and confidence that our long-term franchise goals are well embedded in our businesses, I have concluded that this is an opportune time for me to pursue other interests in my life. I know that Bob Lipp and the rest of our team have the ability to continue to bring the Consumer business to new heights of accomplishment.

John S. Reed and Sanford I. Weill, Co-Chief Executive Officers of Citigroup, said, “Bill has played an enormous role in the successful integration of our consumer businesses and has helped to lead the Consumer segment to the record results it is achieving. We understand the reasons behind his decision, and are pleased that he has agreed to remain available on a consulting basis to assure a smooth transition and to help the Consumer Business reach its goals for 1999. He takes this step with our respect and best wishes. At the same time, we know that Bob Lipp, who immediately becomes Chairman and Chief Executive Officer of the Global Consumer Group, will provide solid leadership for us.”

Robert I. Lipp said, “At the time of the merger that created Citigroup, the tremendous potential we had to establish a new model for serving our customer’s financial needs was clear. Bill has been an important part of our efforts both to create this model and to lead it to the financial success it is now achieving. I will miss his day-to-day involvement both personally and professionally.”

Citigroup (NYSE: C), the world’s most global financial services company, provides some 100 million consumers, corporations, governments and institutions in 100 countries with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, insurance, securities brokerage and asset management. The 1998 merger of Citicorp and Travelers Group brought together such brand names as Citibank, Travelers, Salomon Smith Barney, Commercial Credit and Primerica under Citigroup’s trademark red umbrella. Additional information can be found at: [www.citi.com][1].

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

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People’s Update

CT-based People’s Bank reported this morning that net credit card charge-offs, as a percent of average managed receivables, stood at 3.97% for the first quarter, compared to 3.85% for the first quarter of last year and 3.71% for the fourth quarter. Meanwhile credit card delinquencies improved to 2.66% of quarter-end managed receivables, compared to 3.35% a year ago and 3.06% at year-end 1998. People’s also reported that managed credit card fees rose 24%. According to CardData (www.carddata.com), at the end of the first quarter 1999, People’s had $3,633,404,606 in card loans; $1,730,588,253 in first quarter volume; 2,767,657 gross accounts; 1,766,538 active accounts; and 3,492,742 cards-in-force.

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Equifax – CSCU

Equifax and Card Services for Credit Unions announce they have extended an agreement for Equifax to provide card processing services for all 1,750 CSCU members. Equifax has processed CSCU card programs continuously since 1989. The new agreement begins October 1, 1999 and continues through September 30, 2004, adding five more years to CSCU’s 10-year relationship with Equifax. Total revenues over the life of the new agreement are estimated at $500 million. Since partnering with Equifax in 1989, CSCU membership has increased from 478 to 1,750 members. Cardholder accounts have increased from 1.3 million in 1989 to 6.9 million in 1999.

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Hypercom Buys JTS

Hypercom announced Thursday it has acquired the assets and business of JTS ChequeOut Solutions, Inc.. JTS is a provider of card-based, multi-lane financial and marketing systems for US supermarket chains. Hypercom says JTS will become a division of Hypercom and will be based in Rochester, NY. The new division will report to Roger Hitchcock, the VP/GM of Hypercom’s POS Multi-Lane Division. The acquisition is in line with Hypercom’s strategy of entering and establishing a leadership position in the estimated $500 million multi-lane payment terminal and systems market global provider of electronic payment solutions.

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Mid-Player Rebound?

Early results from CardData’s (www.carddata.com) ‘First Quarter 199 Portfolio Survey’ indicates mid-tier issuers, as a peer group, are regaining strength. NC-based BB&T Financial added more than 28,000 accounts during the first quarter while receivables barely declined. UT-based First Security likewise added about 5,000 accounts with a modest decline in outstandings. OH-based Provident Bancorp. realized a 24,000 account gain with surprising 25% increase in first quarter receivables.

1Q/99 PORTFOLIO STATS

ISSUER OUTSTANDINGS VOLUME ACCOUNTS ACTIVES CARDS

BB&T Financial $373,803,000 $194,592,000 451,057 237,525 526,453
First Security $212,401,020 $122,725,768 287,876 134,869 388,749
Provident Bancorp $206,951,361 $118,294,359 155,032 84,469 172,388

Source: CardData (www.carddata.com)

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Starnet Australia

Starnet Communications International Inc. has announced its wholly owned subsidiary EFS Australia Pty Ltd. has successfully launched its Australian on-line transaction processing facility in association with Westpac Banking Corporation of Australia and Pure-Commerce Pty. Ltd. of Australia.

EFS Australia offers yet another alternative for Starnet to process on-line real time credit card transactions for its subsidiaries and licensees. Since its inception, EFS has provided connections to a variety of banks around the world, and processed hundreds of thousands of transactions for a variety of online merchants. In association with Pure-Commerce Pty. Ltd. and Westpac Banking Corporation, EFS will utilize Starnet’s proprietary STAR-MX technology to process international financial transactions via the Internet with ease and security.

Westpac Banking Corporation, “Australia’s First Bank”, is one of Australia’s oldest financial institutions, originating in 1817, and has global assets of more than A$118 billion. Pure-Commerce Pty. Ltd. acts as a complete support service and processing gateway for electronic commerce in Australia.

Terry Bowering, Vice president, Offshore Operations for Starnet Communications International Inc., states “Australia is one of the world’s leaders in the adoption of computer technology. It has an extremely advanced banking system and Internet infrastructure and is currently a forerunner in many niche industries including Internet Gaming. This event marks another step in Starnet’s plan to expand its global presence.”

Starnet is a fully reporting U.S. (Delaware) corporation, which is currently listed on the National Association of Security Dealers (“NASD”) Over-The-Counter Bulletin Board and commenced trading in September of 1997 under the symbol “SNMM”. Starnet is also listed on the Berlin Stock Exchange (“Berlin”) and is publicly traded on Over-The-Counter market under the symbol “SNM”.

Starnet is an Internet software, technology and service company, which commercializes on-line applications for established markets. For more information, please visit [www.snmm.com][1].

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The statements contained herein which are not historical fact are forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements, including, but not limited to, certain delays in testing and evaluation of products and other risks detailed from time to time in Starnet’s fillings with the Securities & Exchange Commission.

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

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India ATM Net

MasterCard International announced this morning that Citibank, Standard Chartered Bank and HDFC Bank have joined MasterCard/Cirrus network in India. The move makes the MasterCard network the largest in India serving more than one million MasterCard and Maestro cardholders. It also represents the first time the three banks have interconnected. The network is comprised of 146 ATMs in 16 cities.

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NPC First Quarter

National Processing, Inc.reported a net loss of $68 million for the three months ended Mar. 31. Included in first quarter results were pre-tax restructuring charges of $2 million for the closure and relocation of certain processing facilities and an estimated impairment loss of $74 million to provide for the sale, liquidation or disposal of the Freight Payables, Payables Outsourcing, Remittance, and Merchant Check Services business lines. However, discounting the charges, net income increased 16% for the first quarter and was $5,674,000 compared to $4,908,000 for the corresponding period of 1998. Revenues were $124,463,000, up 10% from $113,649,000 in 1998’s first quarter.

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Mag-Tek & Horizon

Mag-Tek, an international leading provider of card and check technology solutions, has signed a reseller agreement with The Horizon Group, a St. Louis-based distributor of point-of-sale terminals.

According to Mag-Tek, The Horizon Group will distribute the Mini MICR and Mini MICR with Magstripe Reader, designed as low-cost solutions for reading and verifying checks and credit cards. The check verification feature alone provides fast return-of-investment (ROI) by eliminating bad checks.

The Horizon Group, a Hypercom Co., is one of the largest terminal distributors in the United States. “We are very pleased with our relationship with Mag-Tek,” said Scott Rutledge, executive vice-president of The Horizon Group.

“The quality and reliability Mag-Tek provides in their products, combined with our strong service and deployment, create a very favorable opportunity for our customers.”

Mag-Tek Inc. ([www.magtek.com][1]) manufacturers an ever-expanding line of MICR check readers, magnetic stripe and smart card readers, encoders and motorized readers for retailers, financial institutions and OEMs.

Since 1972 its headquarters have been in Carson, with sales offices throughout the United States, Europe and Asia with international distribution in more than 40 countries. Mag-Tek, known worldwide as an industry leader in technology and innovation, pioneered magnetic stripe readers more than 27 years ago.

Mag-Tek technology is used in millions of point-of-sale (POS) and financial transactions utilizing debit cards, credit cards, grocery store checkouts, automated gas pumps, pay phones and airplane seat phones throughout the world. For more information on any Mag-Tek products call 888/624-8350 or visit the company’s Web site at [www.magtek.com][2].

[1]: http://www.magtek.com
[2]: http://www.magtek.com

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ICSA TruSecure

Less than a year after leading the move to independent verification of transactional web site security, First Data Direct Banking is making the industry-leading ICSA TruSecure? web site certification available to its client banks.

“While the exponential growth of e-commerce demonstrates that Internet users are more comfortable with online financial transactions than they were as recently as a year ago, security concerns are still among the most pervasive impediments to the growth of Internet banking,” said Randy Kahn, president of First Data Direct Banking. “Enabling our financial institutions to offer their customers a `security blanket’ with their practices verified by a respected, independent agency, is one more way we’re helping them to increase consumer acceptance and usage of Internet banking services.”

Because the core systems where financial transactions take place at First Data Direct Banking’s data center have already been certified and are continuously monitored to ensure compliance with ICSA’s rigorous security standards, the time, effort and cost required to extend that certification one step further, to a NetPrecision financial institution’s web site, are reduced significantly. For a fee that is just a fraction of the cost of a complete ICSA TruSecure security service, NetPrecision clients will be able to certify their own sites and display the ICSA TruSecure logo, Kahn said.

“While online banking offerings continue to grow, so do security concerns. First Data Direct Banking has demonstrated a true commitment to security as well as privacy for its clients. Building on its TruSecure? Web certification, First Data Direct Banking has developed a program to extend independent validation of security requirements based on ICSA’s stringent standards to its clients,” said Peter Tippett, founder, chairman and chief technologist at ICSA. “This program contributes to a company’s ability to ease customer security issues and help its clients attain TruSecure certification. ICSA is pleased that First Data Direct Banking recognizes that security requires continuous effort.”

“Extending ICSA certification service to NetPrecision clients is just one more leading-edge service that demonstrates First Data Direct Banking is serious about partnering with its clients to provide the most complete Internet Banking solutions available today,” Kahn said. “By taking advantage of ICSA TruSecure verification and our free Privacy Policy Program, financial institutions can demonstrate a commitment to protecting the security and integrity of their customers’ information that is unmatched anywhere else in the industry.”

First Data Direct Banking pioneered use of the ICSA certification standard in the financial services industry in May of 1998, when it became the first industry vendor to obtain Web Host certification. A year later, financial services firms represent about 50 percent of ICSA’s new business development.

About First Data Direct Banking

First Data Direct Banking builds and hosts customized Internet financial service solutions for banks, credit unions, savings and loans, non-bank credit card issuers and brokerage houses of all sizes.

Using the NetSpeed(superscript: SM) process as a template, financial institutions can have fully functional, branded web sites up and running in just 30 business days with the NetPrecision system. First Data Direct Banking ties leading-edge online financial services partnerships and template, custom-built or existing web sites into transaction processing provided by electronic payments processing leader First Data Corp.

First Data Direct Banking can be found on the World Wide Web at [www.netprecision.com][1].

Atlanta-based First Data Corporation (NYSE: FDC) is a leader in payment systems, electronic commerce and information management products and services. First Data and its principal operating units process the information that allows millions of consumers to pay for goods and services by credit, debit or smart card at the point of sale or over the Internet; by check or wire money. For further information about First Data, please visit the Company on the Internet at [www.firstdatacorp.com][2]. About ICSA, Inc.

ICSA, Inc., a Gartner Group affiliate, is the world’s source of objective, independent, Internet security assurance services. Through ICSA’s TruSecure suite of services, businesses are managing their information security risks and expanding their usage of Internet technology. For the past 10 years, ICSA has collected data on security tools, best practices, and the industry at-large to become the central authority on information security. ICSA has used its leadership and expertise to support the growth of Internet business and commerce worldwide. Information Security is the official publication of ICSA and is dedicated to the needs of all security-conscious professionals. ICSA is headquartered in Reston, Virginia and has additional offices in North and South America, Europe and Asia. Contact ICSA at (888) 396-8348.

[1]: http://www.netprecision.com
[2]: http://www.firstdatacorp.com

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AT&T Cards for PNC

PNC Bank announced Thursday the availability of ‘AT&T PrePaid Cards’ through its network of ATMs. The cards will initially be available from ten PNC Bank branches in the Pittsburgh area. As the program rolls out, however, it is expected the cards will be available through ATMs at many PNC Bank branches in the Pittsburgh area as well as at select malls and convenience stores. The ‘AT&T PrePaid Card’ is available at PNC Bank locations as a 60-minute card and costs $20. The cost is debited from the purchaser’s bank account, and the transaction is not subject to any surcharge from PNC Bank.

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