Headlines:
Strategic Review for iBill
ATLANTA - The payment processor InterCept Inc. announced Tuesday that the chief executive officer of its merchant services division, John M. Perry, had begun a strategic review of its iBill division after the departure of that unit's chief.
InterCept's stock lost half its value on a single day in January after it warned of an earnings shortfall blamed largely on iBill, which InterCept bought in April 2002 to process credit card payments for Internet merchants.
iBill had operated as an "Internet payment service provider," allowing small companies to accept credit cards online without having to register individually with Visa U.S.A. and MasterCard International The service was popular with adult-entertainment Web sites, which by some estimates accounted for 90% of iBill's business.
But the card associations changed their rules in November, and "high-risk" online merchants now have to register individually and to pay additional fees. That change has caused iBill's processing volumes to drop sharply.
InterCept also said Tuesday that it and the former owners of iBill had amended the purchase agreement to eliminate certain earnout provisions. Carole Collins, the investor relations director at InterCept, said in an interview that the company was to have paid iBill's executives as much as $8 million a quarter through yearend if certain profit goals were achieved.
InterCept said it would retain $8 million from a $10.5 million escrow account set up "to secure representations and warranties of the former owners," with the former owners of iBill getting the remaining $2.5 million.
Garrett Bender, iBill's president and chief executive, left the company, and Mr. Perry is directing its day-to-day activities. InterCept executives had said that they wanted to move iBill toward more mainstream accounts.
UnionBanCal Takes Studio Suite
SAN DIEGO - Union Bank of California has selected a mortgage-loan origination system that uses Internet technology.
Richard C. West, a senior vice president at Union Bank and the manager of its mortgage loan division in San Diego, said the UnionBanCal Corp. unit picked the Studio software suite from Loansoft Inc. of Berkeley, Calif., to replace a PC-based system it had used for about six years.
The new software, which is remotely hosted by Loansoft, can import data that loan applicants file at Union Bank's Web site, and it prompts lenders about unfinished applications. "We just don't get incomplete files any longer, because the system prompts the loan officers to fill in the blanks, anything they might have missed," Mr. West said.
The mortgage staff has been using the new software since December, Mr. West said.
Loansoft announced the UnionBanCal selection on Monday. UnionBanCal is two-thirds owned by Bank of Tokyo-Mitsubishi Ltd.
