Headlines:
Hypercom to Use SEC Buyback Rule Metavante to Handle Corporate Taxes, Too BB&T Using a Credit Risk Tool from SAS
Hypercom to Use SEC Buyback Rule
The Phoenix point of sale terminal manufacturer Hypercom Corp. is using a Securities and Exchange Commission rule to help it purchase its own stock.
Hypercom, which initiated a $20 million program Nov. 9, said Thursday that it would spend up to $5 million to purchase shares under the SEC's Rule 10b5-1, which lets a public company repurchase shares at times when it might be prevented from doing so under insider-trading laws or self-imposed trading blackouts.
Scott Tsujita, the head of investor relations, said in an interview Thursday that publicly traded companies cannot normally buy their own stock in the last 15 days of a quarter, or three days after a quarterly earnings announcement. Under Rule 10b5-1, Hypercom can buy back its stock during that time by following preset restrictions related to price and volume.
Hypercom also wants to use a portion of the $5 million to complete a $10 million buyback plan initiated in August 2003.
Matt Marcus, an analyst with AM Investment Partners LLC, said in an interview Wednesday that Hypercom has "tons of cash on the balance sheet," and he predicted that it would either purchase its own shares or pay a dividend to stockholders.
On Wednesday, Hypercom reported a fourth-quarter net loss of $10.5 million, versus a year-earlier profit of $4.5 million. Revenue fell 8.8%, to $68.1 million.
Metavante to Handle Corporate Taxes, Too
Metavante Corp. has begun processing businesses' federal tax payments on credit and signature debit cards.
The Milwaukee company said Thursday that the Internal Revenue Service has agreed to accept card payments for corporate taxes that are filed with the agency's 941 and 940 forms.
Metavante's Link2Gov is one of two companies that the IRS has authorized to process federal tax payments using cards. The other is Tier Technologies Inc.'s Official Payments Corp.
Both vendors, which have handled consumer tax payments for several years, charge taxpayers a fee to cover the transaction's interchange costs. (Federal law prohibits the IRS from paying fees to process card payments.) Metavante said that businesses may claim that fee as an expense.
The number of consumers who paid their federal income taxes with a credit or signature debit card in the last fiscal year, which ended Sept. 30, rose 50% from a year earlier and 163% from the year before that, to 1,468,023, according to the IRS.
"Government payment processing is a high-growth business, especially now with adding in business tax payments," Edward Braswell, Link2Gov's president, said in a press release.
Metavante, a subsidiary of the banking company Marshall & Ilsley Corp., acquired Link2Gov in November but did not say how much it paid.
BB&T Using a Credit Risk Tool from SAS
BB&T Corp. is using software from SAS Institute Inc. of Cary, N.C., to build a credit analysis system to manage risk and reduce bad loans.
Kenneth L. Daniels, an executive vice president and the corporate credit risk manager at the $109.2 billion-asset Winston-Salem banking company, said in an interview Thursday that it has licensed the SAS Credit Risk Management software to make "incremental improvements" in the credit quality of its loan portfolios.
"Our credit quality has been excellent. We want it to be better," he said.
BB&T will start using the system this year to develop predictive models, custom scorecards, and delinquency forecasts for different lines of business, Mr. Daniels said. The company is already storing loan data from several units in a common repository and is building the initial models for the new system.
"It's going to take us into the future for many years," Mr. Daniels said.
Instead of introducing the system by line of business or geographic region, BB&T plans to identify the "key data elements" that can be used to predict the performance of different types of loan portfolios - such as commercial, retail, or mortgage - throughout the company, he said.
"It is an iterative approach. We take one step at a time," Mr. Daniels said.
BB&T will refine and elaborating on these models for years to come, he said, "but every step we take, we will be getting value out."
Eventually, BB&T plans to use the shared data repository for noncredit business lines, such as funds management, marketing, and financial management and reporting, he said.
"This is part of a much larger project that we're doing," Mr. Daniels said. "Data is the key."
SAS said it signed its deal with BB&T in December. BB&T, which has been an SAS customer since 1991, uses its software for anti-laundering compliance and to identify and generate sales leads.
