Comments About ATM Surcharge Ban in San Francisco From Robert Rose, President and CEO, CO-OP Network.

ONTARIO, Calif.--(BUSINESS WIRE)--Nov. 3, 1999--

In response to the Nov. 2 decision by San Francisco voters to prohibit financial institutions from surcharging non-customers who use their ATMs, Robert Rose, president and CEO of CO-OP Network, the largest network of ATMs in the United States, issued the following statement.

"Credit unions in CO-OP Network do not surcharge each other's members," says Rose, whose Network has nearly 3,000 ATMs and 6.5 million members in 32 states, with 63 credit unions and 379 ATMs in the Bay Area. "In fact, most credit unions around the country still do not surcharge at all. Despite this, we believe reasonable `convenience fees' are necessary. The vote in San Francisco for the surcharge ban could deter financial institutions from deploying or maintaining ATMs in the city, and could also be legally challenged.

"The need to deploy more and more convenient and readily accessible off-premise ATMs (in retail locations, not branch locations) is increasing. Surcharging has, accordingly, become a competitive tool in securing many ATM sites at off-premise prime retail or remote locations. In many instances, financial institutions are told, `If you want my retail locations for your ATMs, how much will you pay me?' To compete for locations, many financial institutions have had to enact selective surcharging, thus assuring that ATMs are conveniently located for consumers.

"We don't believe that the ATM surcharge ban rulings in cities like San Diego and Santa Monica, nor the vote to ban ATM surcharging in San Francisco, will hold up against national banks or federal credit unions' chartering structures.

"It's important to note that the credit union community has acted very responsibly in the ATM surcharge environment, and we don't believe any industry should be disadvantaged by the rulings of an agency or public entity. Most financial institutions have to support a branch and ATM infrastructure, and the surcharge is designed to offset some of the costs."

Formed in 1981, CO-OP Network (www.co-opnetwork.org) was created to fill a need among credit unions to have their own reliable ATM network. Located in Ontario, Calif., CO-OP Network is wholly owned by its credit union shareholders and provides volume discounts to its members through economy of scale achieved by its members' total volume.