Total System (TSS) Spreads In UK With Lloyds Banking Group
Zacks Investment Research | Jul 14, 2016 08:44AM ET
In an attempt to expand its commercial card portfolio in the UK, Total System Services Inc. (NYSE:TSS) has renewed its agreement with Lloyds Banking Group (LON:LLOY).
Lloyds Bank formed in 2009 boasts more than 30 million customers and over 2000 branches throughout the region. It operates a multi-brand strategy, which includes Lloyds Bank, Bank of Scotland and Halifax.
Per the deal, Total System will process Lloyds Banking Group's portfolio through its TS2 platform. The partnership also complements the company’s strategy to improve its relationship with the bank’s customers as it plans to offer risk management, fraud avoidance and other support services tagged along with these cards.
Overall, the alliance is expected to strengthen the card processor’s client base and payment processing network in the U.K. Moreover, the new contract should enhance Total System’s payment volumes and the number of processed transactions, thereby supporting its financials.
Last September, Total System entered into another strategic alliance with Metro Bank of U.K.
The company also has tie-ups with banks in other regions such as First Hawaiian Bank, KBC Bank of Ireland and Columbia State Bank. Total System has been strengthening its clientele by offering customized and flexible processing solutions to all its partners across the globe, primarily in the merchant acquiring space. Additionally, the company is making efforts to tap opportunities in the recovering markets through high-grade technology.
However, Total System is consistently challenged by strong competition, currency fluctuation and stringent regulatory reforms, which have affected its pricing and credit allocation. Yet, we believe that a healthy business model, strategic acquisitions, alliances and technical competence will consistently drive growth within Total System.
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