Credit Management Solutions Inc. had a better-than-expected fourth quarter as the indirect auto lending market responded enthusiastically to its new automated loan technology.

Analysts had been expecting the Columbia, Md., maker of credit analysis software to record a loss of about $200,000. Instead, the company earned $347,891, or 5 cents a share. That was a whopping 604% increase over the $49,369 in net income it recorded a year earlier.

Company president James DeFrancesco said strong sales helped to offset expansion costs. Revenues rose to $5.2 million for the quarter, from $3.5 million in the 1995 period. For the full year, revenues were $14.3 million, up from $10.2 million in 1995.

Credit Management Solutions is upgrading a value-added network that streamlines the exchange of data on loan applications by linking auto dealers with financial institutions.

Two dozen banks have signed letters of intent to use the network. Among them, NationsBank Corp. has begun marketing the upgraded network software and services to auto dealers.

Credit Management Solutions developed the system with Automatic Data Processing Inc. of Roseland, N.J. Automatic Data, the leading payroll processor, also provides software and professional services to 17,000 car and truck dealerships.

Gary R. Craft, an analyst at Friedman, Billings, Ramsey & Co., Arlington, Va., said that, based on transaction fees of about $7, the market Credit Management is targeting could be worth $250 million annually.

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