Total System Services Inc. took two steps in recent days to help its financial institution clients cope with their loan problems.

The Columbus, Ga.-based credit card processor formed an alliance with First Performance Corp. to help prevent chargeoffs of delinquent accounts, and another with Rothenberg Systems International for debt collection and recovery management.

In each case, Total System "offers to clients a service that they couldn't get as cost effectively elsewhere," said Andrew W. Marks, vice president.

About a year ago, Mr. Marks said, the company began to consider options for dealing with the delinquency problems then on the horizon. The idea was to make support services available to Total System users as part of their processing packages.

The strategic-alliance approach won out over building such capabilities in-house or making acquisitions. The two deals were announced before the start this week of the American Bankers Association's bank card conference in Orlando.

First Performance Corp. is a specialist in the pre-chargeoff niche of the collections business. It deals with delinquent accounts before the writeoff point, acting according to client-bank dictates to stave off losses while retaining customers.

The Fort Lauderdale, Fla., company uses early-stage collections approaches pioneered in the 1980s by Integratec, a company founded by former bank credit card executive A. Wayne Johnson.

Integratec was later bought by First Data Corp., where Mr. Johnson worked until last year. First Data, a rival card processor, is larger than Total System.

Mr. Johnson recently joined with Michael Diamond, president of First Performance, to help get the firm up and running. Capital came from the firm's majority owner, Pacific Holdings Corp. of Dallas.

Mr. Diamond said he expects to have 200 to 250 people in place by Oct. 15 to begin managing Total System client accounts.

He said his company is aware of banks' financial and marketing needs to deal sensitively with late payers. "We call in the name of the bank," he said.

Rothenberg Systems, a 30-employee company with 40 customers including Signet Bank, Norwest Card Services, and J.C. Penney Co., gains a big chance to grow, as Total System serves some 140 card issuers with 76 million accounts.

Santa Clara, Calif.-based Rothenberg will make available its Atlas system, the only Windows-based software for collections management. Total System viewed it as a "total solution for managing delinquencies through the entire cycle," Mr. Marks said.

Timothy Johnson, Total System's director of business development, said Atlas is fully integrated with the processor's systems and allows for direct PC connections and full outsourcing, if the client chooses.

The collection system also helps manage bankruptcy cases, litigation, work flow management, skip tracing, and various types of documentation and reporting.

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