Equifax: 2002 Annual Report

Successfully extending a 104-year-old business into new markets, new applications and new products demonstrates The Equifax Difference at work — continually pushing the business to a higher level of service and value for customers and shareholders and ultimately benefiting the consumer.

Our Core Strength
Growth business. It is a term usually reserved for start-ups and emerging markets, but at Equifax, we have a growth business that even at 104 years old is still setting records. In fact, our Information Services business has been finding ways to grow bigger and serve more customers for more than a century by aggregating increasing amounts of data, utilizing even more sophisticated technology and introducing an array of innovative products.

Today, Information Services remains as viable as ever. In times of economic expansion, this business grows in tandem with increased spending and investment. In times of recession, Information Services is even more relevant as it provides businesses and lenders the tools to better assess risk and enhance credit decision-making — abilities that are essential to managing successfully through an economic downturn.

Our core U.S. credit reporting business has for the past decade posted a compound annual growth rate of 14 percent. And, even during the sluggish economy of 2002 when so many businesses faltered, U.S. credit reporting achieved four percent volume growth, in part due to strong demand from mortgage services customers.

A key strategy over the past decade has been to increase the breadth and depth of data through affiliate acquisition. This effort advanced substantially in 2002 with the acquisition of key assets from CBC (Credit Bureau of Columbus), our second largest affiliate. As a result, we have more data under our control and are able to serve our customers more effectively and efficiently with direct sales, products and support.

Products That Work Harder
At Equifax, product innovation is synonymous with continued growth. We were the first to offer Equifax Decision Power®, a decisioning platform. Recently, we introduced significant enhancements to the Decision Power product portfolio. Decision Power Insight™ is a new automated process for screening banking's demand deposit account applicants. It combines the power of decision-making technology and credit information from Equifax with important closed-for-cause and negative deposit account information. This new product gives financial institutions more knowledge that translates into better risk management and increased profitability.

In addition to enhanced decisioning products, Equifax Information Services was among the first to develop a suite of solutions that addresses the key issues of fraud, risk, bankruptcy and debt collection that face our customers. In this tough economic environment, it is more important than ever to gain insight into these high-risk areas. Products such as eIDverifier®, PinnacleSM and Bankruptcy Navigator Index® are helping customers detect subversive or fragile financial situations so that they can address them before they impact the organization.

ANALYTICS FOR THE FUTURE
In the almost 10 years since we introduced Decision Solutions, we have established a leading position in the analytics and modeling field. We have set the standard for custom and generic models that help in managing lending risks and in pursuing new market opportunities with greater insight. We serve customers in such industries as telecommunications, mortgage services and the automotive industry who use these models in tens of millions of transactions every year to grow and manage their businesses more profitably. As our information assets increase, along with our level of technological innovation, analytics will afford us the opportunity to add even greater value to our data and design additional customer-driven solutions.

A New Growth Arena
Small businesses represent a major pillar of the American economy. The more than 25 million small businesses in the country make up 99 percent of all employers and 52 percent of the private workforce.* By creating and continuing to build a proprietary database — already 16 million businesses strong — Equifax has introduced another industry first and is poised to revolutionize credit reporting in the commercial arena in the United States. In doing so, Equifax has the opportunity to dramatically impact credit grantors' ability to make financing decisions for small businesses, and, in turn, enable financing for an essential growing segment of the economy.

Equifax can now offer credit reports on small businesses, similar to those that we offer on individual consumers. This product is the first in what is expected to be an expanding portfolio of small business products — products that can effectively tap into this market.

Global Value
The information services needs that Equifax meets every day are not limited to the United States. Indeed, over the past 12 years, we have expanded our operations beyond the United States and Canada to include 11 countries in Europe and Latin America. Our commitment to the global markets we serve remains strong as does our outlook for growth on all fronts.

*Source: Testimony of Hector Barreto, Administrator, U.S. Small Business Administration, before the Committee on Small Business, U.S. House of Representatives, 2/13/02.

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