Global Payments, the processor blamed for a Visa and MasterCard data breach last week, is likely to be able to manage its financial hit related to beefing up security.
Over the weekend, reports surfaced of a massive data breach of a Visa and MasterCard processor. Global Payments issued a statement confirming the data breach. Global Payments said that its security systems picked up the threat in March and contacted law enforcement. The company will hold a conference call on Monday at 8am EDT.
It's unclear how many accounts were compromised, but 10 million is the largest reported number thus far.
If that figure sticks, Global Payments can weather the data breach, analysts said. For instance, Wells Fargo Timothy Willi said in a research note that Global Payments, which has US$300 million to US$400 million in unrestricted cash, can pay for the damage.
Willi's take, which lines up with other analysts, is based on the data breach suffered by Heartland in 2008. Heartland is another payment processor and the accounts compromised ran as high as 130 million in a breach that lasted for months. Heartland's tab to data has been US$147 million.
Given Global Payments' compromised accounts is about 10 million, the tab should be lower. RBS WorldPay also had 1.5 million accounts compromised with US$9 million of fraud losses.
Jefferies analyst Jason Kupferberg also noted that Global Payments can weather the hit.
We await more details from the company to clarify the size and potential costs associated with the breach, but we note that even if the highest estimate that we've seen (10 million accounts compromised) is true, this still pales in comparison to the Heartland breach of 2009.
Via ZDNet US