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Barmies Add A$551 Million to Economy
news.com.au, AAP Newswire (Australia) - England's Barmy Army has served a purpose other than bolstering their national cricket team's spirits, boosting Australia's economy during the recent Ashes series. A spending analysis of Visa credit cards indicated the series coincided with a 18 percent increase in spending in Australia by Visa cardholders from England between November 2006 and January 2007. Comparing the period of the Ashes series against the same period the year before, spending by UK-issued Visa cards in Australia rose to A$551 million according to a Visa report which will be released at today's Australian Tourism Export Council 2007 symposium. Visa International executive vice president Bruce Mansfield said the result was a great tribute to event organizers and the tourism industry.
Visa Launches Olympic Marketing Campaign to Boost Spending
Krungthep Turakij, Manager Daily, Post Today, Matichon, Baan Muang, Pim Thai, Krasae Hoon (Thailand)- Visa has launched its Olympic-themed TV commercial to kick off its Olympic marketing campaign in Thailand. “Visa has been closely associated with the Olympics since 1986 and the Games itself is becoming an increasingly popular event with the Thai people as we see more Thai athletes establish themselves in the global sporting arena. We hope our close association with the Games and local promotional activities will excite the country as we get closer to the main event and strengthen Visa’s brand preference in Thailand,” said Visa International’s country manager for Thailand Mr. Somboon Krobteeranon. With the Thai credit card market reaching saturation with lower growth in credit card numbers, issuers are focusing on marketing campaign to increase spending through cards rather than increasing card numbers. As of 31 December 2006, Visa had 20.6 million cards in circulation in Thailand, of which 6.7 million are credit cards and 13.9 million are debit cards. Spending on Visa credit and debit cards at merchant locations in Thailand reached Baht 357,476 million, up 23 percent against the previous year.
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Payment Services Directive Agreed: Better Late Than Never?
Banking Technology (UK) - Despite agreement by the Economic and Financial Affairs Council on the wording of the Payment Services Directive (PSD), there is still some confusion as to when it will come into effect. The PSD will be put to the European Parliament for a first reading on 24 April. Peter Ayliffe, chief executive of Visa Europe, said the industry should not lose sight of this next phase, given that the success of the Directive, and SEPA, depended on "consistent implementation across all EU countries."
Consumers Could Pay 20 Percent More to Visa
PR Newswire (US) - Increases in credit card interchange rates announced by Visa average only 0.6 percent, but the US$36 billion in total interchange fees consumers paid in 2006 will probably increase close to 20 percent this year. Mallory Duncan, general counsel of the National Retail Federation and chairman of Merchants Payments Coalition, said, "Interchange fees are already taking too much money out of consumers' pockets. Visa and MasterCard should be lowering interchange rates, not raising them.”
Enterprises Plan to Increase Their Use of Commercial Cards
Le Courrier de la Monétique et de la Carte à Mémoire (France) - Twenty-five percent of all enterprises plan to increase the use of commercial cards in order to avoid the procedures of paper billing and payments and to reduce costs and rates associated with regular payments, a Visa study reports. According to Aliza Knox, senior vice president, Commercial Solutions, Visa International, "this study shows the increasing popularity of the commercial cards whose financial transparencies are globally acknowledged by financial directors."
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OCBC to Keep Cash to Invest Further in China
Business Times, Straits Times (Singapore) - OCBC Bank has paid out more than $27 million in share buybacks for this year alone, but small investors seem hungry for more. At its AGM yesterday, shareholders were keen to know if OCBC plan to return more cash to them. OCBC chief executive David Conner said that the bank may well require its current large amount of capital for further investments aboard.
Temasek, GIC Get Nod to Raise ICICI Stakes
Business Times (Singapore) - India's central bank will let Temasek Holdings and the Government of Singapore Investment Corp (GIC) raise their stakes in ICICI Bank to 10 percent each, the Mint daily reported, citing senior government officials.
Citi Bank Expected to Price IPO at Top of Range
Business Times, Straits Times (Singapore) - China Citi Bank is likely to price its US$5.4 billion IPO - the world's biggest so far this year - at the top of an indicated range on heavy subscription levels, sources said, but worries about economic overheating in China could crimp enthusiasm for IPOs. Citi Bank is expected to price its dual Hong Kong and Shanghai IPO today, with a trading debut set for next Friday.
Maybank Draws $3.6 Billion in Demand for Islamic Debt
The Straits Times (Singapore), International Herald Tribune (Hong Kong) - Malayan Banking's (Maybank) first overseas bond offering that complies with Islamic principles attracted demand for eight times the US$300 million (S$454 million) it sold. Investors placed orders for US$2.4 billion (S$3.63 billion) worth of the securities sold by Maybank, according to HSBC Holdings, one of the sale's arrangers.
UBS May Buy into Firms After China Bank Profit
Business Times (Singapore) - UBS AG, Europe's biggest bank, may put more capital at risk by buying stakes in companies after its investments in Bank of China tripled. "There will be opportunities like Bank of China, where we can take minority interests that would be good for the clients and also our shareholders." Huw Jenkins, global head of investment banking, said in an interview in Hong Kong.
Bank of America's Net Rises 5.4 Percent
The Wall Street Journal Asia (Hong Kong) - Bank of America Corp.'s net income rose 5.4 percent in the first quarter even as profit fell in its three main business lines and the company struggled to increase revenue without help from acquisitions. While exceeding analyst expectations, the results were propelled largely by Bank of America's amorphous "all other" segment, which includes its portfolio of equity investments. Income in that unit jumped to $581 million from $196 million a year earlier.
Saudi Billionaire Takes 3.1 Percent Stake in HSBC
Business Times (Singapore) - Maan al-Sanea, the low-profile Saudi billionaire who purchased a 3.1 percent stake in HSBC, has extensive business interests in Saudi Arabia, China, the United Kingdom and elsewhere. His main corporation, Saad Group, and his investment companies, Singularis Holdings and Awal Trust Company, have so far invested £3.2 billion (S$9.7 billion) to purchase 360 million shares in HSBC. He took the view that the stock is unduly depressed following its February profit warning.
Bank Mandiri's Q1 Profit Doubles
Business Times (Singapore),The Wall Street Journal Asia (Hong Kong), - Indonesia's PT Bank Mandiri said net profit for the first quarter almost doubled, boosted by an increase in net interest income. Net profit rose to Rp 1 trillion (US$110 million), from Rp 510 billion a year earlier. Chief Financial Officer Pahala Mansyuri attributed the increase of the nation's largest bank by assets to gains, including the repayment of debts by several big debtors. Bank Mandiri said net interest income rose 65 percent to Rp 3.8 trillion from Rp 2.3 trillion, spurred by lower interest rates encouraging more borrowing. The non-performing loan ratio as of 31 March fell to 4.7 percent, from 15 percent. Outstanding loans rose 8.7 percent to Rp 114.31 trillion. Assets were valued at Rp 261.03 trillion from 254.89 trillion rupiah.
Thai Banker Sentenced
International Herald Tribune (Hong Kong) - The former head of a Thai bank whose failure presaged Thailand's 1997 economic crisis was sentenced to an additional 20 years in prison. Krirk-Kiart Jalichandra headed the defunct Bangkok Bank of Commerce, which collapsed in 1996 under a huge debt burden, forcing the government to take it over. The Bangkok Criminal Court ruled that Krirk-Kiart and two other bank officers were guilty of embezzlement and malfeasance, sentencing each to 20 years' imprisonment and ordering each to pay a US$46 million fine.
The Philippine Central Bank
International Herald Tribune (Hong Kong) - The Philippine Central Bank unveiled new monetary tools to help mop up liquidity in the banking system while keeping headline rates steady and maintaining a tier scheme for larger amounts deposited with it. The bank said that beginning 10 May it would extend the availability of its special deposit accounts to state pension funds and government-owned companies, to help brake annual money supply growth currency running at over 20 percent.
New Delhi Asks State Banks to Curb High-risk Loans
The Wall Street Journal Asia (Hong Kong) - India's Finance Ministry asked state-run banks to slow lending to certain "high risk" sectors, indicating the government is still worried that credit expansion is overheating parts of the economy. "The credit growth of 30 percent needs to be moderated, and we have advised the banks to do so," Finance Minister P. Chidambaram said on Thursday, after meeting with the heads of state-run banks. Indian commercial bank loans as of 30 March rose 27.6 percent year-to-year to Rs 4.16 trillion ($99.38 billion), with almost 80 percent of loans going to non-food sectors.
Cards Push up Profits for China Merchants Bank
CardLine Asia Pacific (US) - China Merchants Bank saw net income increase more than 80 percent in 2006, thanks in large part to growth in its credit card business. Last year the bank gained more than five million credit card accounts. The bank had issued a total of 10.3 million cards by the end of 2006.
Bank of America Quarterly Profit Rises Five Percent
Reuters (UK) - Bank of America has declared that first-quarter profit rose five percent, as credit card and investment banking growth helped offset a decline in lending margin and higher loan losses. Net income for the second largest US bank increased to US$5.26 billion. Revenue rose two percent to $18.09 billion. Chief executive Kenneth Lewis called the quarter "solid, despite a challenging operating environment." Card fees rose 16 percent to $2.45 billion, helped by the addition of three million accounts. Bank of America set aside $1.24 billion for credit losses, down two percent, but net charge-offs, or loans the bank does not expect to be paid back, increased 74 percent to $1.43 billion.
Chase's Card Income Falls 15 Percent from Last Year
CardLine (US) - JPMorgan Chase's Card Services business contributed revenues of US$3.68 billion to the bank's net revenues of $18.97 billion for the first quarter. Card revenues fell slightly from $3.69 billion in the first quarter of 2006. Card Services contributed $765 million in net income to Chase's total net income of nearly $4.79 billion. Card income declined 15.1 percent from the $901 million in the first quarter of 2006.
Barclaycard to Launch Chip and Pin Boxes and "Green" Card
CardLine Europe (US), TechWeb, Daily Telegraph,Daily Mail, Guardian (UK) - Due to the increase in online fraud Barclays bank is giving out handheld chip and pin readers to half a million customers. Barclays claim the new devices will do away with the need for passwords and usher in an era of online banking security. Barclaycard also plans this summer to introduce what it claims will be an environmentally friendly card with special discounts or promotions encouraging consumers reduce their carbon emissions.
US Bancorp's Payment Processing Grows 1.8 Percent
CardLine (US) - US Bancorp's payment services division reported first quarter net income of US$229 million, a 1.8 percent increase from $225 million during 2006's first quarter. The processing of ATM and merchant transactions, corporate payments, and credit and debit card transactions generates nearly all the non-interest income for the payment services group. The bank held $8.64 billion in credit card loans for the quarter, up 21.3 percent from the $7.12 billion during the same period a year ago.
Student Lending: What SLM May Mean for Bank of America and JPM
American Banker (US) - Bank of America and JPMorgan Chase each cast their plans to buy a stake in SLM, better known as Sallie Mae, in a financial investment that would not affect existing student lending businesses. SLM brings to the table 10 million student loan servicing customers to whom Bank of America and JPMorgan could cross-sell credit cards and other financial products.
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China UnionPay Cards Challenging Visa Cards
Sohu.com, Eastday.com, Ce.cn, People.com.cn, Cnfol.com (China) - China UnionPay has issued more than 10 million debit cards in 2006, ten times more than that of 2005. According to a senior official from UnionPay, Visa cards are not utilizing their absolute advantage. The first four foreign banks have been permitted to operate RMB businesses, and they may issue dual-currency credit cards to develop their business in China. This means the competition between China UnionPay and International credit card organizations like Visa and MCI will become fiercer. However, both parties have their own advantages. Visa owns efficient and effective networks throughout the world, while UnionPay has local advantages that are in line with the interests of Chinese clients.
China UnionPay to Stop Transaction Fee
Sina.com.cn, Sohu.com, Tom.com, Beijing Youth Daily, Beijing Daily Messenger, Youth Daily (China) - After Bank of Communications stopped charging cross-bank inquiry fees on 18 April, six more commercial banks have announced plans to stop fees from 20 April. China UnionPay will also stop charging ATM transaction fees to issuing banks.
Battle of the Brands
Ad News (Australia) - According to Nielsen Media Research, MasterCard International spent A$11.3 million on main media advertising in the 12 months to February 2007, compared to $13.4 million in the same comparable period the year before. MasterCard spent only $740,000 on promoting competitions, compared to $2.5 million in the previous year.
AXP Announced 2007 Q1 Financial Report
Sina.com.cn (China) - American Express released its first quarter financial report in 2007. The quarterly net profit for the company was US$1.6 billion, an increase of 21 percent in comparison with the same period last year. The earnings per share increased to $.87 from $.69.
Merchants See 39 Percent Conversion to Pin-Debit
CardLine (US) - Merchants using VeriFone's On The Spot pay-at-the-table payment terminals saw 39 percent of their card transactions change from credit to PIN-debit transactions during a six-month period. Of consumers who used tableside payment at one of the restaurants, 87 percent said they had a "high" sense of security about using it, 85 percent said it was faster than paying with conventional methods at restaurants, and 52 percent said using a PIN would be important to them.
US Credit Card Deterioration Worst in Four Years
Associated Press (US) - Credit performance worsened across the board in February for the first time since 2003, largely due to a rise in personal bankruptcy filings, according to Moody's Investors Service. The year-over-year losses were, however, skewed by the unusually strong readings seen in 2006.
MasterCard Announces Exclusive Debit Brand Relationship with BECU
Business Wire (US) - MasterCard has announced a contract extension and five-year Debit MasterCard and PIN brand exclusivity agreement with BECU, Washington’s largest credit union. With more than 485,000 members and over US$7.1 billion in assets, BECU is one of the top five financial cooperatives in the US.
Popular Restarting Mainland Card Line
American Banker(US) - Popular Inc. is once again offering credit cards to its mainland customers. Banco Popular North America, the US$47.7 billion-asset San Juan, Puerto Rico, company's Chicago subsidiary, has begun taking applications for two MasterCard credit cards, including one for customers with little or no credit history which must be secured by a Popular savings account.
Plastic Seeking Edge over Paper
FinancialWire, Los Angeles Times (US) - Discover will unveil a card designed to lure small-business owners by offering high frequent-flier miles rewards and few restrictions. Visa and other card companies are also launching products tailored to the small-business market. Credit card issuers want to break out of the traditional travel and entertainment sector and expand into all areas of small-business daily spending.
Study Suggests Banks Should Enter HSA Smart Card Industry
CardLine (US) - Multifunction smart cards have a place in the health care industry and could tie in with payments from pretax health savings accounts, according to Mercator Advisory Group. Banks can provide a debit or credit function on the card to manage the health savings accounts. Banks looking to gain access to the thousands of dollars paid into health savings accounts over time can occupy "real estate" on the smart card, said George Peabody, Mercator's director of emerging technologies advisory service.
APACS Finds Online Fraud Still Increasing
Banking Technology (UK) - Online banking fraud has increased 44 percent from £23.2 million in 2005 to £33.5 million, according to 2006 fraud figures released by the UK payments association APACS, with the vast majority of losses coming from phishing but also Trojans and keylogging activity. APACS said that the introduction of chip and PIN has made it more difficult to commit card fraud in the UK, with losses falling by £146.7 million over the past two years, but there has been an increase in fraud losses abroad over the last 12 months because fraudsters are taking UK card data and using it in countries that have not upgraded to chip and PIN.
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China Economy Stuns with Q1 Growth of 11.1 Percent
Business Times (Singapore), International Herald Tribune, Wall Street Journal (Hong Kong) - China's economy grew at a faster than expected 11.1 percent pace in the first quarter, compared with a year earlier, powered by exports that have inflamed trade tensions and increased the risk of overheating. China will take measures to further strengthen controls over fixed-asset investment, lending and widening trade surplus, Premier Wen Jiabao said.
Central Banker is Upbeat on Japan
The Wall Street Journal Asia, International Herald Tribune (Hong Kong) - Bank of Japan Governor, Toshihiko Fukui maintained his rosy assessment of the Japanese economy and prices, and reiterated that the central bank will continue to manage policy in a timely manner based on economic and price developments. Mr. Fukui said the Japanese economy continues to expand moderately and he remained upbeat on the future.
Four Asia Nations May Face a New Crisis, UN Warns
International Herald Tribune (Hong Kong) - Four Asian nations hit hard by the 1997-98 financial crisis face renewed vulnerability to sudden capital outflows that could cause a currency crisis, the Untied Nations said in a report. Despite the rapid economic growth of the region, Indonesia, South Korea, Thailand and the Philippines have recently showed some cracks in their economies that should be closely monitored, according to the UN's Economic and Social Commission for Asia and the Pacific.
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