Question-and-Answer Session
Operator
(Operator instructions) Our first question today comes from the line of Greg Smith with Merrill Lynch. Please proceed with your question.
Greg Smith – Merrill Lynch
Yes. Hi, good morning guys.
Mike Dubyak
Good morning.
Greg Smith – Merrill Lynch
Just hoping to get some color on your CDs, where the rates that you are having to pay are falling sort of versus expectations just considering you know is there more – heavy demand but is there more competition. Just a little confused where those rates maybe falling down?
Melissa Smith
The rates we said were about 4.06% for the last quarter. The new CDs are between 3 and 4% depending on the maturity. I mean so there is definitely availability but we haven’t really seen a decline in rates.
Greg Smith – Merrill Lynch
Who are the – how do you actually sell those CDs and who are actually the buyers?
Melissa Smith
We go through brokers and so we have a series of brokers, a half of dozen or so that we work with and they are selling to individuals.
Greg Smith – Merrill Lynch
Okay. So they are brokered and then it is individual buyers.
Melissa Smith
Yes.
Greg Smith – Merrill Lynch
Okay, and then Melissa with the charge-offs do you have a rule of thumb on just every 5 basis points of additional charge-offs what that does to EPS, or every 10, just some sensitivity there?
Melissa Smith
Yes, yes it is roughly 1 basis point charge-off equals $0.02 of earnings for the full year.
Greg Smith – Merrill Lynch
$0.02 for the full year. Okay and then if you were to roll your next hedge if you were to do it today, do you know where the prices are roughly?
Melissa Smith
The prices are a little bit above 250 right now for 2010.
Greg Smith – Merrill Lynch
Okay great. Thank you.
Operator
Thank you. (Operator instructions) Our next question comes from the line of Tien-Tsin Huang with JPMorgan. Please proceed with your question.
Tien-Tsin Huang – JPMorgan
Thanks. So, I guess my question – one question, let me ask the $0.07 shortfall that you called out in your prepared remarks. Can you break that down for us again? I didn’t quite catch exactly what drove the $0.07.
Melissa Smith
It is really volume. So, when we went into the third quarter as both Mike and I said we have looked at volume trends in the month of July, August and September trailed off lower than what we had anticipated by a couple of percent to 3% from what we had expected and that is driving the majority of that. We are also a little bit off on late fees in MasterCard which again we are trying to alter this. It seems to be driven by what is going on overall in the economy.
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