Prepaid cards may boost Visa, MasterCard profit

An analyst raised his profit estimates for Visa Inc. and MasterCard Inc. for 2010 and 2011 on Tuesday, saying the increasing use of prepaid cards will boost profitability. William Blair & Co. analyst David Long said the two major payment processing companies are expected to see the greatest benefit from increasing consumer use of prepaid cards.

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Unlike debit cards, prepaid cards do not have a credit line attached. The cards can only be used for the amount preloaded onto it. The user transfers money from a bank account onto the card, or by giving cash to a cashier who swipes the card through a card reader, placing the appropriate balance on it. The cards, therefore, have limited funds available to spend. The cards may be used at businesses accepting similarly branded credit and debit cards and at ATM machines. [Read the full article]

Standard Chartered PLC on Wednesday reported a seventh consecutive record annual profit, of $3.38 billion, as stronger wholesale banking earnings offset an increase in provisions for bad loans and other credit risks.

Impairment losses on loans and other credit rose from $1.3 billion to $2 billion, although the bank said the rate of impairment declined in the second half.

Pretax profit rose 13 percent to $5.15 billion, and operating income was up nearly 9 percent to $15.2 billion, driven by the bank’s wholesale division with a 17 percent rise in interest income.

Standard Chartered shares were up 2.8 percent at 1,635 pence at midday on the London Stock Exchange.

“The bank’s exposure to Dubai had weighed on investors’ minds, but management today issued further assurance that the losses would not be material,” said Richard Hunter, analyst at Hargreaves Lansdown Stockbrokers. [Read the full article]

The Obama administration on Tuesday gave the public a peek at the Bush administration’s classified plan to secure the nation’s computer systems, but the newly revealed list of broad goals provided few surprises and key provisions remain secret.

The decision to publish a summary of the cyber initiative on the White House blog came just a month after the Washington-based Electronic Privacy Information Center filed a lawsuit in federal court seeking release of the computer security document.

Privacy advocates and other groups have long fought to get the Bush cyber plan made public, concerned that it discussed surveillance activities and Internet traffic monitoring by intelligence agencies that could violate Americans’ personal privacy.

The government’s precautions for dealing with cyber security has become a critical national security issue, as U.S. [Read the full article]

Spanish authorities who dismantled a network of up to 12.7 million virus-infected, data-stealing computers said Wednesday the mastermind of the scam remains a mystery, even though three alleged ringleaders have been arrested.

The “botnet” of infected computers included PCs inside more than half of the Fortune 1,000 companies and more than 40 major banks, police said. The tainted computers stole credit card numbers and online banking credentials.

Spanish investigators, working with private computer-security firms, arrested three young Spaniards last month as the alleged ringleaders of the so-called Mariposa botnet, which appeared in December 2008 and grew into one of the biggest weapons of cybercrime.

Spanish authorities are on the trail of a fourth suspect who might be Venezuelan, said Juan Salon of the Spanish Civil Guard’s cybercrime unit. [Read the full article]

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