Fiserv Signs 12-Year, $460 Million -- AUD$600 Million -- Agreement to Provide Cheque Processing for Three of Australia's Largest Banks
Fiserv Signs 12-Year, $460 Million -- AUD$600 Million -- Agreement to Provide Cheque Processing for Three of Australia's Largest Banks
February 4, 2005
Fiserv Signs 12-Year, $460 Million -- AUD$600 Million -- Agreement to Provide Cheque Processing for Three of Australia's Largest BanksBROOKFIELD, Wis.--Feb. 4, 2005--Fiserv, Inc. (Nasdaq:FISV) today signed a 12-year agreement to provide Day One cheque processing and image archive services for Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corp. Based on estimated volumes, the agreement will generate projected revenue of $460 million (AUD $600 million). The three banks will manage the relationship with Fiserv through a utility called Vipro Pty Ltd.
As reported in Fiserv's recent fourth-quarter 2004 earnings release, the transaction will be mildly dilutive to Fiserv's earnings in 2005 by 1 to 2 cents (U.S.) per share due to transition expenses and is expected to contribute to earnings in 2006 and beyond.
Fiserv will supply Vipro with proof-of-deposit, image capture, locked box processing, image archive services and capture-related exception processing to help the banks reduce costs, gain economies of scale and secure new technological capabilities.
"We are very gratified that three of Australia's largest banks have placed their trust in Fiserv to manage this innovative utility," said Leslie M. Muma, Fiserv's president and chief executive officer. "We expect to expand these operations as we seek new ways to not only serve the founding banks, but also to find new clients in both Australia and the region."
Fiserv expects to begin managing operations in six Australian cities in the second quarter for Commonwealth and National, and will begin processing for Westpac in the second half of 2005 as Fiserv consolidates into common operating centers and a common technology platform in each Australian state. The three banks currently process approximately 800 million prime pass items a year.
Fiserv will offer jobs to cheque processing employees of both Commonwealth and National who work in contracted service areas.
Fiserv will implement a single image archive for all three banks and consolidate Day One capture facilities in each Australian state. The common capture and image archive platforms will not only produce cost efficiency, but also enable other operating efficiencies and enhanced product opportunities for each of the banks.
Peter Abbott, executive general manager of retail operations for Commonwealth Bank, said, "This provides an excellent opportunity for Australian banks to work together to more effectively manage the cost of cheque processing operations. Fiserv will bring new processes and technology that will result in continued high levels of service in a cost effective way despite the decline in cheque volumes that we are seeing in the Australian market."
Mark Steyn, regional general manager of operations for National Australia Bank, said, "With volumes in Australia declining at about 5% per annum, the National faced the need to reinvest in cheque processing capabilities in a declining market. By entering into the utility we have been able to avoid the cost of that investment whilst ensuring that all our staff have been offered jobs and that our high customer service levels are maintained."
Andrew Carriline, Westpac general manager, strategic sourcing, said, "The arrangement is a sensible response to declining cheque usage in Australia. By combining the volumes of the three banks we can ensure customers benefit from modern technology and systems and that these are introduced and maintained in a cost-effective manner."
Fiserv is North America's largest third-party check processing provider, annually handling more than 3.7 billion checks for more than 1,600 clients in the United States and Canada. In addition, the company's Information Technology, Inc. (ITI) and Fiserv Imagesoft units provide image-based check processing software used by more than 500 additional financial institutions to process checks in-house. Fiserv operates nearly 50 check-processing centers across the U.S., another six in Canada, two in Latin America and a U.S. image archive that adds more than 7 million check images each day.
Fiserv, Inc. (Nasdaq: FISV) provides information management systems and services to the financial industry, including transaction processing, outsourcing, business process outsourcing and software and systems solutions. The company serves more than 15,500 clients worldwide, including banks, credit unions, financial planners/investment advisers, insurance companies and agents, self-funded employers, lenders and savings institutions. Headquartered in Brookfield, Wis., Fiserv reported $3.4 billion in processing and services revenues for 2004. Fiserv can be found on the Internet at www.fiserv.com.
The disclosure set forth above contains forward-looking statements, specifically statements regarding estimated revenues and earnings, as well as the estimated dates for taking over the management of the banks' check processing operations. These statements are covered by the safe harbor included in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to inherent assumptions, risks and uncertainties that may cause actual results to differ materially from those contemplated by such forward-looking statements. The factors that may cause actual results to differ materially from those contemplated by the forward-looking statements include, among others, the demand for check processing services, delays in completing the transition to Fiserv and general changes in economic conditions or worldwide financial markets. These factors should be considered in evaluating the forward-looking statements, and undue reliance should not be placed on such statements.
As reported in Fiserv's recent fourth-quarter 2004 earnings release, the transaction will be mildly dilutive to Fiserv's earnings in 2005 by 1 to 2 cents (U.S.) per share due to transition expenses and is expected to contribute to earnings in 2006 and beyond.
Fiserv will supply Vipro with proof-of-deposit, image capture, locked box processing, image archive services and capture-related exception processing to help the banks reduce costs, gain economies of scale and secure new technological capabilities.
"We are very gratified that three of Australia's largest banks have placed their trust in Fiserv to manage this innovative utility," said Leslie M. Muma, Fiserv's president and chief executive officer. "We expect to expand these operations as we seek new ways to not only serve the founding banks, but also to find new clients in both Australia and the region."
Fiserv expects to begin managing operations in six Australian cities in the second quarter for Commonwealth and National, and will begin processing for Westpac in the second half of 2005 as Fiserv consolidates into common operating centers and a common technology platform in each Australian state. The three banks currently process approximately 800 million prime pass items a year.
Fiserv will offer jobs to cheque processing employees of both Commonwealth and National who work in contracted service areas.
Fiserv will implement a single image archive for all three banks and consolidate Day One capture facilities in each Australian state. The common capture and image archive platforms will not only produce cost efficiency, but also enable other operating efficiencies and enhanced product opportunities for each of the banks.
Peter Abbott, executive general manager of retail operations for Commonwealth Bank, said, "This provides an excellent opportunity for Australian banks to work together to more effectively manage the cost of cheque processing operations. Fiserv will bring new processes and technology that will result in continued high levels of service in a cost effective way despite the decline in cheque volumes that we are seeing in the Australian market."
Mark Steyn, regional general manager of operations for National Australia Bank, said, "With volumes in Australia declining at about 5% per annum, the National faced the need to reinvest in cheque processing capabilities in a declining market. By entering into the utility we have been able to avoid the cost of that investment whilst ensuring that all our staff have been offered jobs and that our high customer service levels are maintained."
Andrew Carriline, Westpac general manager, strategic sourcing, said, "The arrangement is a sensible response to declining cheque usage in Australia. By combining the volumes of the three banks we can ensure customers benefit from modern technology and systems and that these are introduced and maintained in a cost-effective manner."
Fiserv is North America's largest third-party check processing provider, annually handling more than 3.7 billion checks for more than 1,600 clients in the United States and Canada. In addition, the company's Information Technology, Inc. (ITI) and Fiserv Imagesoft units provide image-based check processing software used by more than 500 additional financial institutions to process checks in-house. Fiserv operates nearly 50 check-processing centers across the U.S., another six in Canada, two in Latin America and a U.S. image archive that adds more than 7 million check images each day.
Fiserv, Inc. (Nasdaq: FISV) provides information management systems and services to the financial industry, including transaction processing, outsourcing, business process outsourcing and software and systems solutions. The company serves more than 15,500 clients worldwide, including banks, credit unions, financial planners/investment advisers, insurance companies and agents, self-funded employers, lenders and savings institutions. Headquartered in Brookfield, Wis., Fiserv reported $3.4 billion in processing and services revenues for 2004. Fiserv can be found on the Internet at www.fiserv.com.
The disclosure set forth above contains forward-looking statements, specifically statements regarding estimated revenues and earnings, as well as the estimated dates for taking over the management of the banks' check processing operations. These statements are covered by the safe harbor included in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to inherent assumptions, risks and uncertainties that may cause actual results to differ materially from those contemplated by such forward-looking statements. The factors that may cause actual results to differ materially from those contemplated by the forward-looking statements include, among others, the demand for check processing services, delays in completing the transition to Fiserv and general changes in economic conditions or worldwide financial markets. These factors should be considered in evaluating the forward-looking statements, and undue reliance should not be placed on such statements.