Gemplus sees large growth potential in Financial Services in Indonesia

Outlines overall growth strategy for financial services and banking sectors

Indonesia, 12 July 2005, Gemplus International S.A. (Euronext: LU0121706294 - GEM and NASDAQ: GEMP), the world’s leading provider of smart card-based solutions, sees substantial growth potential in the financial sector in Indonesia. With EMV¹ worldwide migration gaining momentum in the banking industry, more and more banks are turning to smartcard technology to reduce card fraud and related losses as well as increase market share and revenue by providing more value-added services such as improved loyalty programs. Together with its network of partners, Gemplus will be introducing EMV smartcard solutions to Indonesia.

Leading independent research and advisory firm, Financial Insights, forecasts that Indonesian banks will spend approximately US$450 million on IT and related financial technology by the end of 2005, representing a year-on-year growth of 34%. This will grow to more than US$500 million in 2006. The 10 largest banks' share of total bank IT spending is set to grow from about 70% in 2005 to 75% in 2009.²

“The banking industry is highly competitive and always seeking innovative and experienced partners – banks in Indonesia are no exception. They are keen adopters of technology and Gemplus has the vast knowledge and experience in providing EMV consulting to meet their business needs,” commented Goh Say Yeow, General Manager, Financial & Security Services, South East Asia, Gemplus Technologies Asia. “Our strategy is to work closely with local partners to deliver end to end solutions to meet our customers’ business needs. We strongly believe that having local partners that understand the local culture is vital for our growth in Indonesia.”

In addition to offering a wide range of EMV products and value-added applications, Gemplus provides a comprehensive portfolio of training courses and consulting services for organisations to gain expertise in the new technology.

Gemplus will be organizing a two-day business seminar to be held at the Intercontinental MidPlaza Jakarta, Indonesia from July 13 – 14, 2005. At the seminar, Gemplus will share leading finance industry best practices as well as highlight their offerings in the Financial Services and ID sector. Examples of current and future real-life worldwide implementations for single and multi-application smart card programs in the finance, government, IT, and transportation industries will also be discussed.

“Gemplus is confident that the next few years will see a steady smart card growth in Indonesia as banks migrate to chip cards for EMV and government initiatives for e-passports and National ID gain momentum as part of the global fight against terrorism,” said Goh.

1) EMV is a smart card standard that was created in 1996 and developed by Europay, MasterCard and Visa. The EMV standard is recognized internationally, guaranteeing worldwide interoperability and security for both credit and debit applications. Across Asia/Pacific, Europe and South America, banks have been advised that they must migrate from magnetic-stripe-based credit and debit cards to chip-based cards, because fraud levels within these regions are high with magnetic-stripe cards.

2) Indonesia Banking Industry IT Spending 2005-2009: Big Leaps are Being Made (Financial Insights, May 2005), www.financial-insights.com.
 

About Gemplus
Gemplus International S.A. (Euronext: LU0121706294 - GEM and NASDAQ: GEMP) is the world's leading player in the smart card industry in both revenue and total shipments (source: Gartner-Dataquest (2005), Frost & Sullivan, Datamonitor.). It has sold over 5 billion smart cards.

With security at its core, and 2400 patents and patent applications produced by its innovative R&D team, Gemplus delivers a wide range of portable, personalized solutions in areas including Identity, Mobile Telecommunications, Public Telephony, Banking, Retail, Transport, Healthcare, WLAN, Pay-TV, e-government, and access control.

Gemplus' revenue in 2004 was 865 million Euros..
www.gemplus.com

For more information:
Janet LOH
Gemplus Technologies Asia
Tel: +65 6317 3333
Fax: +65 6873 7971
Email: janet.loh-tk@gemplus.com

Deden PURNAMAHADI
Indo Pacific
Tel: +62 21 781 2436
Fax: +62 21 781 2423
Email: deden@indopacificpr.co.id
 

©2005 Gemplus. All rights reserved. Gemplus, the Gemplus logo, and SafesITe are trademarks and service marks of Gemplus S.A. and are registered in certain countries. All other trademarks and service marks, whether registered or not in specific countries, are the property of their respective owners.

Some of the statements contained in this release constitute forward-looking statements. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties, and other factors that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activities, performance, or achievements expressed or implied by such forward-looking statements. Actual events or results may differ materially. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Factors that could cause actual results to differ materially from those estimated by the forward-looking statements contained in this release include, but are not limited to: trends in wireless communication and mobile commerce markets; our ability to develop new technology, and the effects of competing technologies developed and expected intense competition generally in our main markets; profitability of our expansion strategy; challenges to or loss of our intellectual property rights; our ability to establish and maintain strategic relationships in our major businesses; our ability to develop and take advantage of new software and services; and the effect of future acquisitions and investments on our share price. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of such forward-looking statements. The forward-looking statements contained in this release speak only as of this release. We are under no duty to update any of the forward-looking statements after this date to conform such statements to actual results or to reflect the occurrence of anticipated results.