Total System Services Inc.
) announced a strategic alliance with US-based bank-related
financial company -
) KeyBank NA, in order to process the consumer credit cards for
KeyBank offers services related to deposits, lending, cash
management and investments in about 14 states across the US.
These services are offered to individuals as well as small and
Last year, KeyBank acquired a credit card portfolio worth $725
million from Elan Financial Services, which highlights the role
of Total System to process this card portfolio through its TS2
platform and issue new credit cards in the future, overall
strengthening the payment processing network.
The partnership also complements KeyBank's strategy to bolster
its relationship with customers as it plans to offer risk
management, fraud avoidance and other support services on these
cards. On the other hand, the new contract should enhance Total
System's payment volumes and a number of processed transactions,
thereby supporting the financials.
However, this is not the first time that both parties have
joined forces. Last year, KeyBank had appointed Total System to
manage the conversion of a small acquisition portfolio. The
authenticity of TSYS Program Solutions and its ability to meet
the needs with precision and speedscored well with KeyBank and
ultimately resulted in attaining a bigger contract from the
Total System has been strengthening its clientele by offering
customized and flexible processing solutions to all its partners,
primarily in the merchant acquiring space. Additionally, the
company is making efforts to tap opportunities in the recovering
markets through high-grade technology.
Overall, Total System is challenged with strong competition,
currency and interest rate fluctuations along with stringent
regulatory reforms that have disturbed the pricing, credit
allocation and business model of the company. Hence, we believe
that Total System will require consistent top-line growth along
with strong expense management in order to maintain the stability
in its margins and cash flow.
While Total System carries a Zacks Rank #4 (Sell), other
strong performers in the financial sector include
Fleetcor Tech Inc.
). All these stocks carry a Zacks Rank #1 (Strong Buy).
FLEETCOR TECH (FLT): Free Stock Analysis
KEYCORP NEW (KEY): Free Stock Analysis Report
TOTAL SYS SVC (TSS): Free Stock Analysis
VANTIV INC-A (VNTV): Free Stock Analysis
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