Fiserv, Inc. (NASDAQ: FISV) a Fortune 500 company, provides information management systems and services to the financial and insurance industries. Leading services include transaction processing, outsourcing, business process outsourcing (BPO), software and systems solutions. The company serves more than 16,000 clients worldwide.[1] Fiserv has been ranked the largest provider of information technology services to the financial services industry worldwide from 2005-2009 except in 2007 when it gave up the position to Fidelity National Information Services.[2] Fiserv reported more than $4.7 billion in total revenue for 2008.
Fiserv, Inc., incorporated in 1984, is a global provider of financial services technology solutions, including electronic commerce systems and services such as transaction processing, electronic bill payment and presentment, business process outsourcing, document distribution services, and software and systems solutions. The Company serves approximately 16,000 clients worldwide, including banks, thrifts, credit unions, investment management firms, leasing and finance companies, retailers, merchants, and government agencies. The Company operates centers in the United States for full-service financial data and transaction processing, software system development, item processing and check imaging, and technology support. Its operations are principally located in the United States. The Company operates through four business segments: Financial Institution Services (Financial), Payment and Industry Products (Payments), Corporate and Other. In June 2010, the Company acquired AdviceAmerica, Inc., a developer of software for financial advisors, wealth managers and bank trust departments. In February 2011, the Company acquired Mobile Commerce Ltd. In March 2011, the Company acquired Credit Union On-Line Inc.
Payment
The Payments segment primarily provides electronic bill payment and presentment services and debit and other card-based payment products and services to meet the electronic transaction processing needs of the financial services industry. The businesses in this segment also provide Internet banking, investment account processing services for separately managed accounts, card and print personalization services, and fraud and risk management products and services. The Company’s e-banking business is comprised of its electronic bill payment and presentment services and its Internet banking and cash management products. Financial institutions can offer its bill payment services to consumers either through a hosted application or through various protocols that link online banking applications to its internal billing and payment system.
The Company’s principal online consumer and business banking product is Voyager, a software platform, upon which the Company has built a number of software applications to support multiple lines of banking businesses. Corillian Online combines its electronic bill payment and online banking solutions into an integrated product that provides extensive personal money management and other valuable tools. The Company also provides a series of treasury management solutions, including online business banking, commercial cash management, remote deposit, and corporate data exchange, under its BANKLINK brand. The Company’s Mobile Money product provides a variety of mobile banking and payments services, including balance inquiry, transaction history, bill payment and transfers, through a mobile device to its clients and their customers. It enables financial institutions to reach more consumers through the mobile channel than any other single technology solution because it supports all three mobile access modes: browser, text banking, and mobile application.
In 2010, the Company introduced ZashPay, a person-to-person payments service that enables the secure, electronic movement of money to and from bank accounts based in the United States ZashPay can be accessed through the Websites of participating financial institutions, as well as a portal, . In 2010, the Company delivered approximately 330 million electronic bills to consumers through its various distribution channels. Consumers access its electronic billing and payment solutions through numerous hosted channels, including through a financial institution’s Internet portal, through the billers’ Internet sites, and through its biller services Internet portals, . Additionally, consumers can make bill payments, including emergency or expedited payments, through its agent-assisted, Internet or interactive voice response phone tools and at its nationwide walk-in bill payment locations. Its electronic biller services business also offers a host of club management and electronic financial transaction services within the health and fitness industry.
Fiserv’s Card Services business, in the electronic funds transfer marketplace, provides a total payments solution through a variety of products and services. The Company offers automated teller machine (ATM) and point of sale personal identification number (PIN)-based debit transaction processing, signature debit processing, ATM driving and monitoring, electronic benefits transfer switching and national and regional network access. The Company owns the ACCEL/Exchange network and operates approximately 20,000 ATMs. Its Card Services business’ clients include more than 4,200 banks and credit unions of all asset sizes, resellers (via both business alliance and remarketer agreements), independent sales organizations and merchant acquirers across the United States. In 2010, the Company processed over 8.8 billion ATM and debit transactions. The Company’s credit products and services fulfill a range of bank card, retail, commercial and consumer credit processing requirements through an integrated, full-service credit management solution that utilizes a globally recognized processing platform. Its credit processing system provides credit decisioning, authorization processing, online cardholder account management, customer service case management, letters, card production, statements, targeted marketing programs, collections, and recovery management.
The Company’s output solutions business provides clients with electronic document management through its electronic document delivery products and services; card manufacturing, personalization and mailing; statement production and mailing; design and fulfillment of direct mail solutions; forms distribution; laser printing and mailing, and office supplies. The Company provides a range of technology platforms and software solutions, which assist over 325 firms, including broker dealers, global asset managers, investment advisors, banks and insurance companies, to deliver portfolio management, enhanced trading solutions, performance measurement, reporting services, corporate actions, billing, and trading automation to their clients. Its primary product is a real-time portfolio management and trading system used by brokerage firms and asset managers offering managed accounts. Its risk management business provides a suite of products and services, including financial crime, compliance, anti-money laundering, fraud prevention, market surveillance and employee fraud detection solutions. Its offerings in this market include Fiserv KRM, Fraud Risk Manager, Fraud Detection System, Fraudlink, and Fraudguard.
The Company competes with Fidelity National Information Services, Inc. (FIS), Online Resources Corporation, Jack Henry and Associates (Jack Henry), MasterCard Incorporated, Visa, Inc. and First Data Corporation
Finance
The Company provides products and services to meet the financial technology needs of banks, credit unions, thrifts and leasing and finance companies. Many of the products and services that it provides are sold as an integrated solution to its clients and include account, item, and lending processing. The Company provides integrated account servicing and management capabilities to its bank, thrift and credit union clients, as well as ancillary value-added products and services that complement the account processing systems. Account processing solutions are the principal systems that enable a bank to operate and include systems that process customer deposit and loan accounts, an institution’s general ledgers, central information files and other financial information. These solutions also include extensive security, report generation and other features that financial institutions need to process transactions for their depositors and other customers, as well as to comply with applicable regulations. Account processing solutions are offered through online data transmission connections to its data processing centers, often called service bureaus or as stand-alone, in-house licensed software for installation on client-owned computer systems.
The Company’s account processing solutions include Bank and Thrift Account Processing Solutions and Credit Union Account Processing Solutions. Bank and Thrift Account Processing Solutions, which is the principal service bureau solutions used by banks and thrifts are: Premier, Signature, Cleartouch, Source One and Precision. The Company also offers in-house licensed software solutions to its banking clients, including Premier, Signature and Precision. The Signature system is available both domestically and internationally, and Credit Union Account Processing Solution, which is the principal account processing solutions primarily used by credit unions are: Acumen, Advantage, Charlotte, CUBE, CubicsPlus, CUSA, DataSafe, Galaxy, OnCU, Portico, Reliance, Spectrum, and XP2. These solutions are offered in a service bureau environment, as an in-house licensed software system or in both delivery modes.
The Company offers item processing solutions to financial institutions and other financial intermediaries. It provides item processing and imaging systems via in-house solutions or in a service bureau environment to account processing clients, as well as to those who do not utilize its account processing systems. Its item processing services include source capture solutions via a Web-based platform for check image capture at branch, merchant, consumer, and ATM locations. Through the Fiserv Clearing Network, the Company provides check clearing and image exchange services. Its ACH software, PEP+, enables payments to be originated and received through the ACH system, and, together with its PEP+reACH product, allows returned checks, checks at the point-of-sale, and checks sent to a lockbox to be converted to electronic payments.
The Company’s account reconciliation software, ARP/SMS, is an online, real-time positive pay and reconcilement system that enables clients to monitor deposits and identify duplicate items. Its compliance solutions enable financial institutions, corporations and government agencies to maintain compliance with state and federal regulations applicable to them. It also provides consulting services, business operations services and software products that facilitate the transformation of its clients’ payments environment. In addition, the Company offers traditional item processing services, including image capture, proof of deposit, in-clearings, statements, exception and return processing and fraud detection. The lending business offers a variety of products and services to financial institutions and other financial intermediaries, including loan origination systems, consumer and commercial lease and loan servicing products, and default mitigation and business process outsourcing services; a mortgage loan servicing platform and loan origination and tracking systems, and portfolio analytical services.
The Company competes with FIS, Jack Henry and Open Solutions, Inc.
Steady and impressive growth continued throughout the rest of the 1990s as continued downsizing, consolidation, and pressure to boost revenue prompted banks to hand over back-office functions to external providers. Bankers were beginning to 'view their business not as transaction processing, but as information management and distribution,' according to one consultant in the May 1996 issue of ABA Banking. 'The third party performs processing, but channels the information back to the bank, so that the information becomes the primary currency,' he noted. Fiserv, whose income was up another 25 percent to $51 million in 1994, was there to benefit from the intensified interest in outsourcing. By the end of 1995, the year in which Fiserv signed a multi-million dollar, 12-year strategic alliance with Chase Manhattan bank and a second alliance with State Street Bank in Boston, Fiserv was providing customer account processing to more than 3,000 financial institutions and had an annual income of almost $64 million. While the Chase contract ended when the bank merged a short while later with Chemical Bank, Fiserv rebounded by landing a ten-year $1.6 billion deal to handle back-office processing for two leading Canadian banks in 1996. Moreover, in 1998, it signed on to a five-year contract with First Federal of California.
From 1996 to 1998, Fiserv went from almost $900 million in sales to more than $1 billion and increased its customer base to 5,000, all the while maintaining its tried and true formula for success--choosing and integrating its acquisitions carefully, allowing them a large degree of autonomy, and solidly focusing on customer service. Company policy included surveying clients twice a year for feedback on their working relationship with Fiserv and tying the compensation of business-unit directors to customer satisfaction. At the same time, Fiserv was branching out into other areas of the financial information services processing sector. Six of the company's ten acquisitions in 1997 were related to the brokerage industry, ranging from a deep-discount brokerage house to a manufacturer of software that enabled customers to enter trade orders via the Internet or touch-tone phone. Fiserv also acquired businesses that provided marketing, seminar, and training materials for the financial industry. In 1998, it added a provider of administrative software systems to insurance companies and a provider of automotive leasing software. In all, Fiserv acquired 11 new businesses in 1998, bringing its total number of acquisitions since 1984 to 73.
In the late 1990s, Fiserv began a cross-selling strategy, lessening its dependence on acquisitions to stimulate growth in favor of adding new products that accommodated its customers' expansion into new markets. These included brokering, insurance, auto loan processing, and indirect lending. A Web product for banks, for example, allowed customers access to their bank-branded insurance accounts from the bank's home page. In 1999, Fiserv launched a subscription Internet service called ePrime@Fiserv, which bundled online banking, bill payment, investment and insurance products, cash management automation, back-office processing, and core-account processing into one solution. Fiserv also introduced TheLendingSite.com, which provided the technological backbone for Internet-based lending, such as loan approval and credit card authorization. To complement its new strategy, Fiserv implemented a national television advertising campaign, a branding effort making use of the tag line 'Where money and technology meet.' Another part of Fiserv's branding effort was its own company Web site launched in December 1998.
Overseas Expansion at the Turn of the Century
With 400 customers in 60 countries in late 1999, Fiserv began looking to expand overseas at the turn of the century. The domestic financial services market was still healthy with an annual growth of about 20 percent for the industry's top three competitors--Fiserv, M & I, and Deluxe--but bank mergers were drying up the pool of potential customers. In addition, the privatization of banks in foreign countries and the European Union's conversion to a single currency in 1999, had opened new doors for data processing companies. In some countries, such as Mexico, Brazil, and Argentina, growth for financial services providers was estimated at 30 to 35 percent in the coming years.
By the time George Dalton retired in 1999 and Leslie Muma took over as chief executive, Fiserv was averaging 28 percent annual growth in revenue, 20 percent growth in earnings per share, and 31 percent growth in net income. A share of Fiserv stock valued at $2.74 in 1986 had increased in value nearly 20 times to $52.68. Those who knew the hard-working Dalton were surprised by his decision to retire, but Muma expected to continue Fiserv's aggressive growth pace. As financial services increasingly converged under one umbrella, Fiserv intended to provide more and better services to customers, believing that continued growth through acquisitions, steady internal growth, and providing data services to financial institutions would carry it into the future.
Principal Subsidiaries: First Trust Corporation; Fiserv Correspondents Services Inc.; Fiserv Investor Services, Inc.; Fiserv LeMans, Inc.; Fiserv Solutions Inc.; Fiserv Securities Inc.; Information Technology, Inc.; The Freedom Group, Inc.
Principal Competitors: Affiliated Computer Services, Inc.; Alltel Information Services, Inc.; BISYS Group, Inc.; Computer Sciences Corporation; First Data Corporation; Deluxe Corporation; Electronic Data Systems Corporation; Integrated System Solutions Corp.; M & I Data Services.
OVERALL
Beta: 1.03
Market Cap (Mil.): $8,891.11
Shares Outstanding (Mil.): 143.87
Annual Dividend: --
Yield (%): --
FINANCIALS
FISV.O Industry Sector
P/E (TTM): 18.69 20.57 19.08
EPS (TTM): 4.47 -- --
ROI: 6.62 21.49 16.11
ROE: 15.89 23.55 17.77
Statistics:
Public Company
Incorporated: 1984
Stock Exchanges: NASDAQ
NAIC: 51421 Data Processing Services; 541611 Administrative Management and General Management Consulting Services
Company Perspectives:
Fiserv's mission is to be the leading provider of data processing and information management products and services to the financial industry by providing the technology-based information processing systems essential for the automation of the financial services industry; to deliver the products and services that help our clients grow their businesses and enhance service to their customers by offering the financial services industry the technology resources necessary for them to compete successfully in today's market; to enable people to achieve outstanding job performance and personal growth by focusing on one of our most important assets--our people--through strong benefit programs, competitive compensation packages, ongoing training and the encouragement to grow professionally; to produce a favorable level of earnings and consistent earnings growth for our Company, and increased value for our shareholders by understanding the changing needs of the financial services industry, positioning our Company as the industry's technology provider of choice and prudently managing the pursuit of our business goals.
Key Dates:
1984: George Dalton and Leslie Muma found Fiserv.
1986: The company goes public.
1993: Fiserv accomplishes its largest buyout, that of Basis Information Technologies, Inc.
1995: Fiserv signs strategic alliances with Chase Manhattan bank and with State Street Bank in Boston.
1999: Dalton retires and Muma becomes CEO.
Name Age Since Current Position
Dillon, Donald 71 2000 Independent Chairman of the Board
Yabuki, Jeffery 51 2005 President, Chief Executive Officer, Director
Hirsch, Thomas 48 2010 Chief Financial Officer, Executive Vice President, Treasurer, Assistant Secretary
Ernst, Mark 52 2011 Chief Operating Officer, Executive Vice President
Sprague, Charles 62 1994 Executive Vice President, General Counsel, Secretary
Cox, James 48 2006 Executive Vice President - Corporate Development
Warsop, Thomas 45 2010 Executive Vice President, Group President - Global Sales
Olsen, Stephen 51 2010 Executive Vice President, Group President - Digital Payments
Gianoni, Michael 50 2010 Executive Vice President, Group President - Financial Institutions
Tait, Steven 51 2010 Executive Vice President, Group President - Depository Institution Services
Kight, Peter 55 2010 Director
Levy, Gerald 79 1986 Independent Director
Kearney, Daniel 72 1999 Independent Director
Renwick, Glenn 55 2001 Independent Director
Wertheimer, Thomas 71 2003 Independent Director
Robak, Kim 56 2003 Independent Director
Simons, Doyle 47 2007 Independent Director
O'Leary, Denis 55 2008 Independent Director
Stern, Carl 65 2011 Independent Director
Address:
255 Fiserv Drive
Brookfield, Wisconsin 53045
U.S.A.
Fiserv, Inc., incorporated in 1984, is a global provider of financial services technology solutions, including electronic commerce systems and services such as transaction processing, electronic bill payment and presentment, business process outsourcing, document distribution services, and software and systems solutions. The Company serves approximately 16,000 clients worldwide, including banks, thrifts, credit unions, investment management firms, leasing and finance companies, retailers, merchants, and government agencies. The Company operates centers in the United States for full-service financial data and transaction processing, software system development, item processing and check imaging, and technology support. Its operations are principally located in the United States. The Company operates through four business segments: Financial Institution Services (Financial), Payment and Industry Products (Payments), Corporate and Other. In June 2010, the Company acquired AdviceAmerica, Inc., a developer of software for financial advisors, wealth managers and bank trust departments. In February 2011, the Company acquired Mobile Commerce Ltd. In March 2011, the Company acquired Credit Union On-Line Inc.
Payment
The Payments segment primarily provides electronic bill payment and presentment services and debit and other card-based payment products and services to meet the electronic transaction processing needs of the financial services industry. The businesses in this segment also provide Internet banking, investment account processing services for separately managed accounts, card and print personalization services, and fraud and risk management products and services. The Company’s e-banking business is comprised of its electronic bill payment and presentment services and its Internet banking and cash management products. Financial institutions can offer its bill payment services to consumers either through a hosted application or through various protocols that link online banking applications to its internal billing and payment system.
The Company’s principal online consumer and business banking product is Voyager, a software platform, upon which the Company has built a number of software applications to support multiple lines of banking businesses. Corillian Online combines its electronic bill payment and online banking solutions into an integrated product that provides extensive personal money management and other valuable tools. The Company also provides a series of treasury management solutions, including online business banking, commercial cash management, remote deposit, and corporate data exchange, under its BANKLINK brand. The Company’s Mobile Money product provides a variety of mobile banking and payments services, including balance inquiry, transaction history, bill payment and transfers, through a mobile device to its clients and their customers. It enables financial institutions to reach more consumers through the mobile channel than any other single technology solution because it supports all three mobile access modes: browser, text banking, and mobile application.
In 2010, the Company introduced ZashPay, a person-to-person payments service that enables the secure, electronic movement of money to and from bank accounts based in the United States ZashPay can be accessed through the Websites of participating financial institutions, as well as a portal, . In 2010, the Company delivered approximately 330 million electronic bills to consumers through its various distribution channels. Consumers access its electronic billing and payment solutions through numerous hosted channels, including through a financial institution’s Internet portal, through the billers’ Internet sites, and through its biller services Internet portals, . Additionally, consumers can make bill payments, including emergency or expedited payments, through its agent-assisted, Internet or interactive voice response phone tools and at its nationwide walk-in bill payment locations. Its electronic biller services business also offers a host of club management and electronic financial transaction services within the health and fitness industry.
Fiserv’s Card Services business, in the electronic funds transfer marketplace, provides a total payments solution through a variety of products and services. The Company offers automated teller machine (ATM) and point of sale personal identification number (PIN)-based debit transaction processing, signature debit processing, ATM driving and monitoring, electronic benefits transfer switching and national and regional network access. The Company owns the ACCEL/Exchange network and operates approximately 20,000 ATMs. Its Card Services business’ clients include more than 4,200 banks and credit unions of all asset sizes, resellers (via both business alliance and remarketer agreements), independent sales organizations and merchant acquirers across the United States. In 2010, the Company processed over 8.8 billion ATM and debit transactions. The Company’s credit products and services fulfill a range of bank card, retail, commercial and consumer credit processing requirements through an integrated, full-service credit management solution that utilizes a globally recognized processing platform. Its credit processing system provides credit decisioning, authorization processing, online cardholder account management, customer service case management, letters, card production, statements, targeted marketing programs, collections, and recovery management.
The Company’s output solutions business provides clients with electronic document management through its electronic document delivery products and services; card manufacturing, personalization and mailing; statement production and mailing; design and fulfillment of direct mail solutions; forms distribution; laser printing and mailing, and office supplies. The Company provides a range of technology platforms and software solutions, which assist over 325 firms, including broker dealers, global asset managers, investment advisors, banks and insurance companies, to deliver portfolio management, enhanced trading solutions, performance measurement, reporting services, corporate actions, billing, and trading automation to their clients. Its primary product is a real-time portfolio management and trading system used by brokerage firms and asset managers offering managed accounts. Its risk management business provides a suite of products and services, including financial crime, compliance, anti-money laundering, fraud prevention, market surveillance and employee fraud detection solutions. Its offerings in this market include Fiserv KRM, Fraud Risk Manager, Fraud Detection System, Fraudlink, and Fraudguard.
The Company competes with Fidelity National Information Services, Inc. (FIS), Online Resources Corporation, Jack Henry and Associates (Jack Henry), MasterCard Incorporated, Visa, Inc. and First Data Corporation
Finance
The Company provides products and services to meet the financial technology needs of banks, credit unions, thrifts and leasing and finance companies. Many of the products and services that it provides are sold as an integrated solution to its clients and include account, item, and lending processing. The Company provides integrated account servicing and management capabilities to its bank, thrift and credit union clients, as well as ancillary value-added products and services that complement the account processing systems. Account processing solutions are the principal systems that enable a bank to operate and include systems that process customer deposit and loan accounts, an institution’s general ledgers, central information files and other financial information. These solutions also include extensive security, report generation and other features that financial institutions need to process transactions for their depositors and other customers, as well as to comply with applicable regulations. Account processing solutions are offered through online data transmission connections to its data processing centers, often called service bureaus or as stand-alone, in-house licensed software for installation on client-owned computer systems.
The Company’s account processing solutions include Bank and Thrift Account Processing Solutions and Credit Union Account Processing Solutions. Bank and Thrift Account Processing Solutions, which is the principal service bureau solutions used by banks and thrifts are: Premier, Signature, Cleartouch, Source One and Precision. The Company also offers in-house licensed software solutions to its banking clients, including Premier, Signature and Precision. The Signature system is available both domestically and internationally, and Credit Union Account Processing Solution, which is the principal account processing solutions primarily used by credit unions are: Acumen, Advantage, Charlotte, CUBE, CubicsPlus, CUSA, DataSafe, Galaxy, OnCU, Portico, Reliance, Spectrum, and XP2. These solutions are offered in a service bureau environment, as an in-house licensed software system or in both delivery modes.
The Company offers item processing solutions to financial institutions and other financial intermediaries. It provides item processing and imaging systems via in-house solutions or in a service bureau environment to account processing clients, as well as to those who do not utilize its account processing systems. Its item processing services include source capture solutions via a Web-based platform for check image capture at branch, merchant, consumer, and ATM locations. Through the Fiserv Clearing Network, the Company provides check clearing and image exchange services. Its ACH software, PEP+, enables payments to be originated and received through the ACH system, and, together with its PEP+reACH product, allows returned checks, checks at the point-of-sale, and checks sent to a lockbox to be converted to electronic payments.
The Company’s account reconciliation software, ARP/SMS, is an online, real-time positive pay and reconcilement system that enables clients to monitor deposits and identify duplicate items. Its compliance solutions enable financial institutions, corporations and government agencies to maintain compliance with state and federal regulations applicable to them. It also provides consulting services, business operations services and software products that facilitate the transformation of its clients’ payments environment. In addition, the Company offers traditional item processing services, including image capture, proof of deposit, in-clearings, statements, exception and return processing and fraud detection. The lending business offers a variety of products and services to financial institutions and other financial intermediaries, including loan origination systems, consumer and commercial lease and loan servicing products, and default mitigation and business process outsourcing services; a mortgage loan servicing platform and loan origination and tracking systems, and portfolio analytical services.
The Company competes with FIS, Jack Henry and Open Solutions, Inc.
Steady and impressive growth continued throughout the rest of the 1990s as continued downsizing, consolidation, and pressure to boost revenue prompted banks to hand over back-office functions to external providers. Bankers were beginning to 'view their business not as transaction processing, but as information management and distribution,' according to one consultant in the May 1996 issue of ABA Banking. 'The third party performs processing, but channels the information back to the bank, so that the information becomes the primary currency,' he noted. Fiserv, whose income was up another 25 percent to $51 million in 1994, was there to benefit from the intensified interest in outsourcing. By the end of 1995, the year in which Fiserv signed a multi-million dollar, 12-year strategic alliance with Chase Manhattan bank and a second alliance with State Street Bank in Boston, Fiserv was providing customer account processing to more than 3,000 financial institutions and had an annual income of almost $64 million. While the Chase contract ended when the bank merged a short while later with Chemical Bank, Fiserv rebounded by landing a ten-year $1.6 billion deal to handle back-office processing for two leading Canadian banks in 1996. Moreover, in 1998, it signed on to a five-year contract with First Federal of California.
From 1996 to 1998, Fiserv went from almost $900 million in sales to more than $1 billion and increased its customer base to 5,000, all the while maintaining its tried and true formula for success--choosing and integrating its acquisitions carefully, allowing them a large degree of autonomy, and solidly focusing on customer service. Company policy included surveying clients twice a year for feedback on their working relationship with Fiserv and tying the compensation of business-unit directors to customer satisfaction. At the same time, Fiserv was branching out into other areas of the financial information services processing sector. Six of the company's ten acquisitions in 1997 were related to the brokerage industry, ranging from a deep-discount brokerage house to a manufacturer of software that enabled customers to enter trade orders via the Internet or touch-tone phone. Fiserv also acquired businesses that provided marketing, seminar, and training materials for the financial industry. In 1998, it added a provider of administrative software systems to insurance companies and a provider of automotive leasing software. In all, Fiserv acquired 11 new businesses in 1998, bringing its total number of acquisitions since 1984 to 73.
In the late 1990s, Fiserv began a cross-selling strategy, lessening its dependence on acquisitions to stimulate growth in favor of adding new products that accommodated its customers' expansion into new markets. These included brokering, insurance, auto loan processing, and indirect lending. A Web product for banks, for example, allowed customers access to their bank-branded insurance accounts from the bank's home page. In 1999, Fiserv launched a subscription Internet service called ePrime@Fiserv, which bundled online banking, bill payment, investment and insurance products, cash management automation, back-office processing, and core-account processing into one solution. Fiserv also introduced TheLendingSite.com, which provided the technological backbone for Internet-based lending, such as loan approval and credit card authorization. To complement its new strategy, Fiserv implemented a national television advertising campaign, a branding effort making use of the tag line 'Where money and technology meet.' Another part of Fiserv's branding effort was its own company Web site launched in December 1998.
Overseas Expansion at the Turn of the Century
With 400 customers in 60 countries in late 1999, Fiserv began looking to expand overseas at the turn of the century. The domestic financial services market was still healthy with an annual growth of about 20 percent for the industry's top three competitors--Fiserv, M & I, and Deluxe--but bank mergers were drying up the pool of potential customers. In addition, the privatization of banks in foreign countries and the European Union's conversion to a single currency in 1999, had opened new doors for data processing companies. In some countries, such as Mexico, Brazil, and Argentina, growth for financial services providers was estimated at 30 to 35 percent in the coming years.
By the time George Dalton retired in 1999 and Leslie Muma took over as chief executive, Fiserv was averaging 28 percent annual growth in revenue, 20 percent growth in earnings per share, and 31 percent growth in net income. A share of Fiserv stock valued at $2.74 in 1986 had increased in value nearly 20 times to $52.68. Those who knew the hard-working Dalton were surprised by his decision to retire, but Muma expected to continue Fiserv's aggressive growth pace. As financial services increasingly converged under one umbrella, Fiserv intended to provide more and better services to customers, believing that continued growth through acquisitions, steady internal growth, and providing data services to financial institutions would carry it into the future.
Principal Subsidiaries: First Trust Corporation; Fiserv Correspondents Services Inc.; Fiserv Investor Services, Inc.; Fiserv LeMans, Inc.; Fiserv Solutions Inc.; Fiserv Securities Inc.; Information Technology, Inc.; The Freedom Group, Inc.
Principal Competitors: Affiliated Computer Services, Inc.; Alltel Information Services, Inc.; BISYS Group, Inc.; Computer Sciences Corporation; First Data Corporation; Deluxe Corporation; Electronic Data Systems Corporation; Integrated System Solutions Corp.; M & I Data Services.
OVERALL
Beta: 1.03
Market Cap (Mil.): $8,891.11
Shares Outstanding (Mil.): 143.87
Annual Dividend: --
Yield (%): --
FINANCIALS
FISV.O Industry Sector
P/E (TTM): 18.69 20.57 19.08
EPS (TTM): 4.47 -- --
ROI: 6.62 21.49 16.11
ROE: 15.89 23.55 17.77
Statistics:
Public Company
Incorporated: 1984
Stock Exchanges: NASDAQ
NAIC: 51421 Data Processing Services; 541611 Administrative Management and General Management Consulting Services
Company Perspectives:
Fiserv's mission is to be the leading provider of data processing and information management products and services to the financial industry by providing the technology-based information processing systems essential for the automation of the financial services industry; to deliver the products and services that help our clients grow their businesses and enhance service to their customers by offering the financial services industry the technology resources necessary for them to compete successfully in today's market; to enable people to achieve outstanding job performance and personal growth by focusing on one of our most important assets--our people--through strong benefit programs, competitive compensation packages, ongoing training and the encouragement to grow professionally; to produce a favorable level of earnings and consistent earnings growth for our Company, and increased value for our shareholders by understanding the changing needs of the financial services industry, positioning our Company as the industry's technology provider of choice and prudently managing the pursuit of our business goals.
Key Dates:
1984: George Dalton and Leslie Muma found Fiserv.
1986: The company goes public.
1993: Fiserv accomplishes its largest buyout, that of Basis Information Technologies, Inc.
1995: Fiserv signs strategic alliances with Chase Manhattan bank and with State Street Bank in Boston.
1999: Dalton retires and Muma becomes CEO.
Name Age Since Current Position
Dillon, Donald 71 2000 Independent Chairman of the Board
Yabuki, Jeffery 51 2005 President, Chief Executive Officer, Director
Hirsch, Thomas 48 2010 Chief Financial Officer, Executive Vice President, Treasurer, Assistant Secretary
Ernst, Mark 52 2011 Chief Operating Officer, Executive Vice President
Sprague, Charles 62 1994 Executive Vice President, General Counsel, Secretary
Cox, James 48 2006 Executive Vice President - Corporate Development
Warsop, Thomas 45 2010 Executive Vice President, Group President - Global Sales
Olsen, Stephen 51 2010 Executive Vice President, Group President - Digital Payments
Gianoni, Michael 50 2010 Executive Vice President, Group President - Financial Institutions
Tait, Steven 51 2010 Executive Vice President, Group President - Depository Institution Services
Kight, Peter 55 2010 Director
Levy, Gerald 79 1986 Independent Director
Kearney, Daniel 72 1999 Independent Director
Renwick, Glenn 55 2001 Independent Director
Wertheimer, Thomas 71 2003 Independent Director
Robak, Kim 56 2003 Independent Director
Simons, Doyle 47 2007 Independent Director
O'Leary, Denis 55 2008 Independent Director
Stern, Carl 65 2011 Independent Director
Address:
255 Fiserv Drive
Brookfield, Wisconsin 53045
U.S.A.
Last edited: