Big Banks Strike Discounts WithMasterCard

PURCHASE, N.Y. - (05/29/06) – MasterCard Internationalreported Friday it has signed discount and rebate agreements withthree of its major bank-owners, similar to the deal it signed withBank of America. The separate agreements provides pricing discountson fees and other incentives in exchange for transaction volumes onMasterCard-branded cards with Citibank, JP Morgan Chase and HSBC.The three banks and BofA own almost 31% of MasterCard shares andaccounted for the same percentage of net transaction revenue forthe first quarter of 2006, according to documents filed with theSecurities and Exchange Commission by MasterCard in connection withlast week’s initial public offering. Under the separatedeals, MasterCard paid Citibank $1 million in 2005 and $100,000 forthe first quarter of 2006; JP Morgan Chase $4 million and $1million, respectively; HSBC $1 million and $200,000; and BofAminimal payments for 2005 and none for 2006.