Barbara L. Gasper - Director Ajaypal S. Banga - Chief Executive Officer, President, President of Mastercard International, Chief Executive Officer of Mastercard International and Director Martina Hund-Mejean - Chief Financial Officer Noah J. Hanft - Chief Franchise Integrity Officer, General Counsel, Chief Compliance Officer and Corporate Secretary

Sanjay Sakhrani - Keefe, Bruyette, & Woods, Inc., Research Division Moshe Katri - Cowen and Company, LLC, Research Division Bryan Keane - Deutsche Bank AG, Research Division Darrin D. Peller - Barclays Capital, Research Division Tien-Tsin T. Huang - JP Morgan Chase & Co, Research Division Julio C. Quinteros - Goldman Sachs Group Inc., Research Division Rod Bourgeois - Sanford C. Bernstein & Co., LLC., Research Division Glenn Fodor - Morgan Stanley, Research Division Bill Carcache - Nomura Securities Co. Ltd., Research Division Craig J. Maurer - Credit Agricole Securities (USA) Inc., Research Division Moshe Orenbuch - Crédit Suisse AG, Research Division Jason Kupferberg - Jefferies & Company, Inc., Research Division

Good day, ladies and gentlemen, and welcome to the Q2 2012 MasterCard Earnings Conference Call. My name is Laura, and I'll be your operator for today. [Operator Instructions] I would now like to turn the conference over to your host for today, Ms. Barbara Gasper, Head of Investor Relations. Please proceed.

Thank you, Laura. Good morning, everyone, and thank you for joining us today, either by phone or webcast, for a discussion about our second quarter 2012 financial results. With me on the call today are Ajay Banga, our President and Chief Executive Officer; and Martina Hund-Mejean, our Chief Financial Officer. Following comments from Ajay and Martina, the operator will announce your opportunity to get into the queue for the Q&A session. Up until then, no one is actually registered to ask a question. This morning's earnings release and the slide deck that will be referenced on this call can be found in the Investor Relations section of our website at mastercard.com. Both the earnings release and the slide deck include reconciliations of any non-GAAP measures to their GAAP equivalent. They have also been attached to an 8-K that we filed with the SEC earlier this morning. A dial-in replay of this call will be available for 1 week through August 8. And finally, as set forth in more detail in today's earnings release, I need to remind everyone that today's call may include some forward-looking statements about MasterCard's future performance. Actual performance could differ materially from what is suggested by our comments today. Information about the factors that could affect future performance are summarized at the end of our press release, as well as contained in our recent SEC filings. And now with that, I will turn the call over to Ajay.

Thanks, Barbara. Good morning, everybody. In the second quarter, we saw net revenue grow 9% as reported or 13% on a constant currency basis. This increase was driven by healthy volume and transaction growth, which helped to fuel net income growth of 17%, and EPS growth of 19%, a very good quarter despite some of the global economic headlines that we've all seen. And so while looking at those underlying economic trends, I'm just going to start with the United States. And our MasterCard SpendingPulse data shows that second quarter retail sales x auto for the economy as a whole grew by 5.5%, but this growth is not as robust as the 7.4% we saw in the first quarter. MasterCard's United States GDV followed that trend with 9% growth in the second quarter versus 14% in the first quarter. And this pace of retail sales growth right now is expected to slow further through the second half of this year. Most of this anticipated deceleration is explained by tougher comps in the economy versus a year ago. However, consumer confidence could also play a role and one example of that is that the impact of lower gas prices is not yet making its way back into other sectors of U.S. consumer spending, and in fact, is adding to the savings rate of households in the United States as the FT says this morning. The housing market seems to be showing some signs of recovery but unemployment rates have remained around 8%, as we all know, for the past 2 quarters. And given all this in the current economic situation, our perspective is we would need to see more stable growth signals before expecting U.S. consumer confidence levels to show a sustained increase. In Europe, despite the current economic headlines, our…

Thanks, Ajay, and good morning, everyone. Let me begin on Page 3 of our Web slide deck, where I will focus on the non-GAAP figures, which exclude the additional $20 million pretax charge we took this quarter related to the U.S. merchant litigation settlement. For the second quarter, we saw solid top line and bottom line results. Net revenue grew 9% or 13% on a constant currency basis, driven by strong volume and transaction growth, as well as new deals. Total operating expenses increased 6% or 9% on a constant currency basis. Bottom line, we delivered net income of $713 million, up 17% or 23% on a constant currency basis, and diluted earnings per share of $5.65, up 19% or 24% on a constant currency basis. As I mentioned last quarter, we expected to realize some onetime benefits to our 2012 effective tax rate. Therefore, besides enjoying the positive effects of our prior tax spending initiatives, we also finalized some work which resulted in discrete benefits relating to additional export incentives and the conclusion of tax examinations in some jurisdictions. Cash flow from operations was $641 million. And we ended the quarter with cash, cash equivalent and other liquid investments of about $5 billion. While not shown on this page, during the second quarter, we repurchased about 1.6 million shares at a cost of approximately $671 million. And through July 26, we repurchased an additional 132,250 shares at a cost of $57 million. We have now completed the previous $2 billion share repurchase authorization and have $1.4 billion remaining of the new $1.5 billion authorization. We will continue to look to repurchase shares on an opportunistic basis. So let's now turn to Page 4 where you can see the operational metrics for the second quarter of 2012. As you can…

Thanks, Martina. We're now ready to begin the question-and-answer period. And in order to get to as many people as possible, we ask that you limit yourselves to a single question and then queue back in for additional questions. Laura?

[Operator Instructions] Your first question comes from the line of Sanjay Sakhrani from KBW. Sanjay Sakhrani - Keefe, Bruyette, & Woods, Inc., Research Division: So I had a question for Ajay. You mentioned that you'd kind of focus on items that you can control, as long as the economic uncertainty continues, and I was just wondering if you could just elaborate on those levers a little bit more, maybe specifically around the operating margin? I think Martina gave some color as to what you guys are anticipating but what happens if the top line doesn't pan out as you expect it to?

Sanjay, let's first discuss the top line for a second. I have tried to lay out that I believe what drives our top line are those 3 concentric circles, the outermost one being the growth of personal consumption expenditure. And a lot of my commentary in the beginning was around how I'm not sure where that will go, maybe not at the 5% or 6% that we have been consistently getting over the last few years. Although I don't know for a fact, I'm just assuming that things look a little dodgier on that front than they did a little while ago. The other 2 concentric cycle circles, one is what percentage of that PCE goes into electronic transactions versus cash. And currently, around 80-something-percent goes into cash, and I'm still very focused on growing the electronic share in that, hence, all the effort on government programs, prepaid programs, Social Security, social benefits, all that that you see, as well as small ticket payments, mobile payments. All that comes from trying to change the ratio in that space. And the last concentric circle is our share in the 13%. I think, if you do the math on the way our transactions are growing, not just because of U.S. debit, you will find that we're making some progress there as well, although we've always got more work to do in that space. So I kind of think of those 3 levers. I think of the outermost concentric circle in revenue being less than easy to predict today and I'm focused on the next 2. That's the top line. Now let's talk the other way, expenses. I think what you'll find us doing is to ensure that we meet our guidance of at least 50% of that operating margin we've talked about.…

And next question comes from the line of Moshe Katri from Cowen and Company.

So if I'm looking at gross store volumes, especially in the rest of the world, in credit, it was up 8.3%. Last quarter, it was up 17.6%. Is it possible just to reconcile the differences and maybe just give us a feel on what sort of FX headwinds you had there?

The FX headwinds for volumes were really not different than what we had been calling out, right? I mean, we said when you look at domestic -- when you look at GDV, the GDV on a constant currency basis was about 15%. On a U.S. dollar basis, it's about 9%. So you have a 6 percentage point headwind on GDV. And when you look at credit versus debit, there is really not much difference on that.

So just -- so the 17.6% should be -- if you kind of look at this at apples-to-apples basis, it should be roughly -- this quarter should be, what? Like in the -- somewhere in the 12%, 13% range, if I adjusted for FX headwinds?

I think, directionally, you are correct.

And your next question comes from the line of Bryan Keane with Deutsche Bank.

Just looking at the constant currency 13% growth rate, how much of that growth was from new business wins? And as we go forward into the second half to a year, how do we think about the incremental growth rate we'll get from new business wins?

Look, we really don't split new business wins out. You have to have an appreciation. Of course, you can't just get to the 13% without having new business wins but you're going to have to go back to how we build our model over the longer term. So basically, we are -- and I'm going back right to the concentric circles that Ajay has been just laying out. We're starting with personal consumption expenditure growth and that's typically, over longer period, 5% to 6% per year. This year, it's probably a little bit low, so that's lower. So that is impacting us. Then you have the secular trends. The secular trends on a per year basis can be anywhere between 4 to 6 percentage points. We haven't finished the year so I can't really give you yet where we are ending up in that 4 to 6 percentage points. Now when you add those 2 factors together, you get into the 9% to 11% growth rate. So in order to get to 13%, of course, you're going to have to have a couple of percentage points attributed by the new things that we are doing, and that could be new business wins, it could be expanding into other markets, it could be getting these kinds of government programs that Ajay has been laying out. There are a number of things in that number.

And Brian, it's Ajay. You should remember that that 5 to 6 percentage points of PC in growth which Martina was calculating into the 9% to 11% that you get to by adding that to the secular growth, we don't know, as of today, what that 5% or 6% will be. So we're trying to give you normalized thinking, and frankly, that's how we approach our business in those concentric circles. But we don't know what that 5% to 6% will be. If you ask me today, it feels lower, but 2 months later, we might have a different opinion, depending on how the world economies are performing. Right now, given all we're seeing in consumer spending, it feels lower than the 5% to 6%. I just don't know yet.

Okay. And then just lastly, any update on the timing you guys are hearing from the EC on potential recommendations from the Green Paper? And any impact that you could see maybe coming out of that, if they talk about routing freedom or access to cash balances with the ability to clear and settle for third-party providers? Just trying to think about the potential impact coming out of that -- those recommendations.

We don't have any update on any timing from them. We're kind of, I told you, actively engaged in discussions with them. We have given them a point of view. We are in constant dialogue with them. We don't have any update with them yet.

And your next question comes from the line of Darrin Peller with Barclays.

I just wanted to touch base on, again, on rebates and incentives. I know that you shy away from really guiding towards it, but Martina, thanks for the color on the second half, at least, overall. Overall, though, in the quarter, they were at higher level than I think than we expected and it sounds like you're expecting somewhat of a similar run rate going forward, based on the discussion around new signings and overall revenue growth. While I understand there's new deals and renewals, is there any shift in strategy around incentives, maybe similar to what we've seen at one of your competitors or even from merchants or banks and where it's going? Perhaps and maybe how it was allocated in the past?

No, Darrin, absolutely not, there's no change in this. And you might recall that a year, or a couple of years ago, I laid out, actually, a split of our rebates and incentives between what is really driven from a volume perspective versus what is really driven from a new deal or a new deal signing. And we typically say, when you look at our total rebates and incentives over a whole year -- so you have to take a total year, don't just take a quarter -- about 70% of our rebates and incentives is driven really by volume and by the increased business that we are getting. 30% is typically driven by new deals or renew deals. And even in this quarter, and I don't expect for any part of this year, it will be -- there will be any difference whatsoever.

Okay, that's helpful. So similar -- just expect similar kind of trends in the second half that we saw this quarter, more or less?

As you very eloquently said, it's all embedded in the thoughts that I gave for 2012.

And just to make sure you get the picture around -- inside your question was aspects of other people doing things with the way they're using rebates and incentives across merchants versus issuers. We haven't changed our strategy, which is get ourselves onto the back of those debit cards, get ourselves enabled for them to be used, watch how that goes, do not try and apply rebates and incentives in a broad way. I'm not in the position of protecting a large pre-regulatory change market share. I'm in the business of growing market share in this opportunity, and use them surgically and sensibly. And nothing's changed in that picture. We are exactly where we were in that strategic thinking. Nothing's changed.

And your next question comes from the line of Tien-Tsin Huang with JPMorgan. Tien-Tsin T. Huang - JP Morgan Chase & Co, Research Division: I just wanted to ask, Ajay, just give us maybe some high level thoughts on some of the concessions that were given on the merchant litigation, specifically surcharging in some of the smaller items?

So I kind of, when I approach this -- I think we had this conversation with the investor and analyst community sometime back as well, and I was talking about how I would be reluctant to agree to long-term changes in the methodology by which interchange is computed and used. We did agree, as you know, one portion of this is a short-term change. But the surcharge angle, frankly, for a long time in MasterCard, surcharging has been going on in some parts of the world, partly promoted by legal changes in those countries. Discounting for cash has been going on for a long time and we have never enforced anything differently from that. I still share the belief that all these kinds of things create friction for a consumer, for a merchant, for everybody in the electronification of payments. And so, when I talked about that second concentric circle of secular change, these things create friction. Frictions aren't good for increasing the speed of that secular change. Yet, the merchants were very clear, the ones who represented [ph] us and negotiated with us, that without that, there was no conversation. So we came to the point where it's either to agree to part of that -- from my perspective. This is only mine, by the way, this is not the other parties in the negotiation. I'm not trying to speak on behalf of the banks. I'm not trying to speak on behalf of Visa. This is me, MasterCard. We believe the best thing to do was looking at our experience of surcharging in other markets where, frankly, it didn't really lead to a great deal of actual surcharges being placed other than in a couple of kinds of areas where cash isn't quite able to compete. So for example, online airline bookings and the like. And even there, in Australia, the Reserve Bank of Australia stepped in recently and created caps for the level of that surcharging realizing that this was not quite what they wanted to have happened, I'm assuming, which is why they stepped in. So when I think about that here, in this agreement, we have also managed to get in some of those protections, the cap and what they could charge, the declaration to the consumer with clarity, both on the receipt and in the store, the level playing field concept that we think we've got in there. All these were attempted as a way to sort of try and box the issue while moving forward. So the bigger picture of tackling the 80-something percentage of transactions that are still in cash can keep on being pursued, instead of all our thoughts being tied up in the passion behind this issue. That's kind of how I approached it, Tien-Tsin. And so it is friction. I don't like the friction but I'm trying to minimize it with as much lubricant as I can put in the system.

And your next question comes from the line of Julio Quinteros with Goldman Sachs.

Hey, Martina, just to go back to the expenses. There's a lot of puts and takes on the constant currency reported, especially on the advertising and marketing side. Can you just go back through those real quickly on the expectations for the second half as it relates to the advertising and marketing, that is both including and excluding the currency?

Yes, I mean, what I really said that you should be expecting that A&M spend will be relatively flat versus 2011 on a constant currency basis. And that would tell you, because of the FX impacts, that it would be lower on an as-reported basis. And then also, I tried to give you a little bit more help on your model from a quarterly perspective. And really, from a quarterly modeling point of view, you should be really thinking about the same kind of rate of usage as in 2011. Now I also said, and Ajay had reemphasized, we are looking at our strategic investments, and that might entail moving things around from A&M to G&A. That is not included in these comments. We will make those decisions as we go along in the next couple of quarters. But this is what I see, this is the best that I'm seeing at this point.

Okay, got it. And then maybe, Ajay, on the credit side, just in terms of the U.S. credit and having some work to do, what does that comment entail? Like, I mean, as you think about having some work to do in U.S. credit, what exactly do you guys think needs to be done there?

Two, 3 years back, Julio -- if you looked at our position in the United States market 2, 3 years ago, in all the different product categories, we were not in the best position in terms of either debit, signature of payments. We were not doing as well as we wanted to in commercial cards. We were doing reasonably well in prepaid, although I think we could have accelerated that momentum. And we were not doing as well as we wanted to in consumer credit because we're reliant on a portfolio of banks that in that mix has been going through some degree of difficulties over the financial crisis. What I've tried to do over these years is to take each of those 4 product categories and change our position in the market. In prepaid, with all that we've done with these governments, as well as our relationships with a number of the prepaid program managers and other issuers, I think we have made real progress. From the Social Security Administration of the U.S., to these state-level programs, all those, we kind of feel good about. In debit, we've actually done reasonably well over the last one year including the wins before the regulatory change with SunTrust and Sovereign and all those pieces. In commercial, we actually feel pretty good. We are making real progress on large corporates and small businesses. It's in consumer credit that I still don't think I can tell you that I've made the breakthroughs. I have wins. I have wins with regional banks. I have wins with independent banks and credit unions. I have reconfirmations of my position in market share in some of the biggest banks. I'm winning little days along the side. I'm not losing anything contrary to what anybody else might say. I'm not losing anything. I'm gaining a little bit here or there, but it doesn't excite me. It doesn't satisfy me. There's work to be done in consumer credit. That's the finality I was trying to get across.

And next question comes from the line of Rod Bourgeois with Bernstein. Rod Bourgeois - Sanford C. Bernstein & Co., LLC., Research Division: Yes. So over the last year, your growth in Europe has been helped by domestic processing wins. And our assumption has been that you may not have additional SEPA-related wins on the near-term horizon, even though SEPA seemingly could still create long-term opportunities if the regulatory environment doesn't change too much in Europe. So with that as the context, can you give us your thoughts on the short term and the longer-term opportunities for wins in Europe related to SEPA, given that you've had a pretty good track record there over the last year or 2?

It's a good question. Our SEPA volumes in this last quarter -- the previous quarter, they were up 200-something-percent. This last quarter, it's closer to less than half of that. So that's because of the lapping of some of those wins. Do I -- it's very tough for me to tell you how I think about this shorter-term because the nature of this wins in SEPA tend to have a peculiar lumpiness in them. We're talking so many of these parties at the same time. Two kinds of results come out of it. One is a constant dribble of incremental transactions from many countries, Germany, France, Belgium. Those are happening even today. They kind of continuously getting some benefits from them. Then I've got the lapping effect of the big wins in the Netherlands that we had last year. In the middle of all that, if 1 or 2 of those big discussions turn into a deal, it will happen in 60, 90 days, not in 350 days, I won't get 350-days notice on it. It may not happen, by the way, in the next quarter, don't get me wrong. It's just that I don't know when to predict how the damn thing will convert from a conversation to a real deal. So I don't know how to give you a better feeling of that number for the shorter term. It's the nature of our business with longer selling cycles. And when the deal happens, it happens. But I could say that if you look at it consistently over a period of time, absolutely, we think our product and our capability with Maestro, with Debit MasterCard, our technology and the fact that we have one global platform, that you can take your Maestro card and use it anywhere in the world, let alone not being able to use it outside of Germany in Europe. Forget about going to Latin America and using it. When you can do all that, then I believe that that is a strong starting point to keep winning business on this line in SEPA. And that's the dialogue we're going ahead with. And Martina, you want to add something?

Rod, just from a nearer-term perspective, to expand a little bit from SEPA, right? When you look, for instance, at the Nordics, we've been working on the Nordics in Europe for a considerable amount of time and had just announced a number of deals, right? Last year, the Swedbank deal, this year, we think that we have a follow-on on that with another bank. And so we are starting to really work out country by country to be getting these kind of wins and putting our cards into the market. So you can't just look at each individual SEPA country. You're going to have to think about the overall strategy. Rod Bourgeois - Sanford C. Bernstein & Co., LLC., Research Division: Right. Well, just a quick follow-up on that. I mean, when you look at the seemingly -- some uncertainty created by the Green Paper and then the underlying motivation of the EC, is that -- are those developments making it more difficult to proceed with SEPA-related wins or is there really no change?

No, no, actually. Remember, in many ways, what we are doing with all these, that actually fit directly into what the EC wanted to have done when SEPA was created, which was to break down the monopolies of the domestic debit schemes and allow for cross-border intra-EU, as well as global players to come into play in that space so that you could increase competition, increase innovation and increase efficiency. For a long while, those conversations wandered off into a local domestic European scheme like money. That's still is getting talk about somewhere in the fringes. But for a long while, that's the only question you guys ask me. And I kept telling you, I don't know for sure whether that will also happen. All I know is it's a moving landscape. We have a terrific product with great efficiency, priced right. That's how we won the Netherlands. That's how we are winning business in different parts of Europe, including the Nordics data that Martina was talking about. I'm pretty confident that that still holds true. So that's about it, Rod.

And your next question comes from the line of Glenn Fodor with Morgan Stanley.

Ajay, with regards to the settlement, as you stated, there's clearly a lot of emotion out there among some of the parties, so could you tell us, is there a mechanism for the defendants, either the networks or the issuers approaching the large merchants who are putting out these headlines these days and helping ameliorate their concerns? And if so, have those efforts started?

Well, I'm not going to sort of go into too much detail there. But I will tell you this, dialogue with all these parties is a consistent part of what we're doing. The fact is not everything about this settlement will suit every individual involved. And so there are those compromises and some parties on both sides are more willing to make some of those compromises, others that aren't. The -- that's kind of a first basic principle. As far as the actual mechanisms are concerned, I've got Noah here. So Noah, do you want to add something to what Glenn was asking?

Sure. Glenn, there's a process in court for merchants to actually express their desire to opt out of the settlement, which actually hasn't occurred yet. That will follow the preliminary approval by the court, which should take place in the fall. At the end of the day, we're confident that the settlement will be -- will receive approval from the court, both from a preliminary approval perspective and from a final approval perspective. It's just like in the Walmart case, there tends to be, in all class action cases, merchants that choose to opt out. But we're confident that at the end of the day, the settlement will be accepted by the court. And notwithstanding the fact that different merchants have different views, we will reach a resolution that should really turn the corner on the years of litigation and allow us to get back to doing business with the important merchant community.

And next question comes from the line of Bill Carcache with Nomura.

I've got a question on buybacks. Some companies look at buybacks as simply a vehicle for returning capital. Others tend to look at it more as opportunistically if there are share price declines. Can you kind of remind us a little bit on your philosophy and whether you would view potential pressure that your shares might come under to the extent that, from a macro perspective, there are some weakness and whether you would look at that as an opportunity to get more aggressive on buybacks?

Okay. So let me just talk a little bit about our philosophy and let me start a little bit in terms of how we think about capital allocation anyhow, right? Because first of all, we're looking at allocating capital to the business, right? That is our first-most focus. Secondly, we are looking to deploy capital from an, what we call, inorganic way, i.e., making acquisitions, investing in other businesses in order to further the goal that Ajay has laid out, to really drive our revenue growth, right? And then last but not least, if you have excess cash available, we're certainly very open to be returning that to shareholders. And at this point in time, our preferred method of returning it to shareholders is really through share repurchase programs. And as you've seen, we have been doing that very consistently in the market. In fact, I think we've been spending close to $1 billion just in 2012, in terms of repurchasing our shares. And the one thing that I just want to always be sure is that we do, that we pick shares up in an opportunistic manner over a certain time period. So you can read out from that that obviously, an opportunistic pick up of shares means that we're watching very closely where the share price is going. And then we move in and do things as we can. Now we can't do that always, okay? And I just want to caution that a little bit. Given that we are a publicly traded company, there are certain trading windows that are open for us where we can do that in a very active manner. However, when we get into what we call a blackout period, which is moving closer to a quarter end and an earnings release, we have to file things like the 10b5-1 plan. That means we have to predetermine what kind of trading activity we want to have on our stock in the market. And of course, we do formula-based kind of activity, so we try to mimic in these plans what we otherwise would be doing when we can go actively into the market everyday. I hope that gives you a little bit of background on how we think about it.

Yes, that's helpful, Martina. And if I may ask Ajay a follow-up. Ajay, does your pursuit of -- you gave a little bit of an update on Telefonica. Can you talk a little bit about whether your pursuit of money transfer solutions with other partners around the world creates any kind of tension with Western Union, given the work that you're doing with them? Basically, as you look forward also, do you expect these tensions to intensify?

Yes. I look -- I actually am doing all this with great partnership with Hikmet at Western Union. In fact, I think there are ways that Western Union and MasterCard, together, could offer an even stronger opportunity to a number of these money transfer opportunities through the phone systems. I've always believed that the phone companies, the operators as well as the hardware folks, can be an integral part of how this new method evolves, rather than an either/or. So I don't see the same kind of tensions. I actually see all of us bringing different capabilities and skills and strengths to the table. And if you can stitch those together, well, it actually works pretty well. And that's the kind of thing we've been doing for the past couple of years, whether it be with Google, whether it be with Telefonica, whether it be with a E.Tel and Zane [ph], or with Deutsche Telekom. We've kind of got issuers, telecom companies and us to work together in some ways to discover this whole mobile payment space. I think there's another set of partners, which is the future set of partners around vouchers, rewards, loyalty, e-receipts. All those will also add value to this whole mobile payment space and money transfer space. So I think what we do well is we build ecosystems. We make partners work together, that's our job. If I start doing an either/or, I would've forgotten our heritage of the company.

And next question comes from the line of Craig Maurer with CLSA. Craig J. Maurer - Credit Agricole Securities (USA) Inc., Research Division: I have 2 questions. The first is in terms of U.S. credit, it would seem that the banks that are focused on issuing cards on your largest competitor are consistently taking share from banks that are issuing on MasterCard. At this point, is this a somewhat unavoidable circumstance in the U.S., as I'm not sure there are any major credit portfolios that are up for renewal at any point soon? And secondly, a question on Europe. Yesterday's antitrust announcement against Visa Europe had a unique twist in it, in that it was also discussing domestic interchange in certain countries. As I understand it, Visa and MasterCard both have domestic interchange rates in certain countries in Europe. And if they do happen to win this case against Visa Europe, do you see this as setting precedent to eventually approach MasterCard on domestic interchange?

So Craig, the first part, the part about credit in the U.S., you're absolutely correct that the mix of the portfolios of various competitors, as well as the Amex GNS business, all those mixes put together are part of what you're seeing in that credit marketplace. And it may change as different banks have different appetites for growing their business in cards. But it is where it is today. And one of the things that we are working with is that circumstance. I don't quite understand the commentary about no possible portfolios being available. So I think that -- I'm just kind of going to leave that out there with you. We keep getting maybe not huge portfolios, which I would like to, but we keep getting new business from a number of banks that traditionally would have been only issuing somebody else's cards. And I think that's true, by the way. Also those banks who've traditionally been issuing our cards, it's in the interest of an issuing bank to find a way to manage to work with more than one network. It suits them, it gives them a better position, it gives them a better capability of constructing their business models. And when I was a banker, that's how I thought about it. So I am somewhat less clear on that part of your question. That's what we're working our way through. And so will it change in a day or 2? No. It's a -- that's the nature of our business. It's a business that has a longer selling cycle. And within the marketplace in the U.S., there are some portfolios that are available, some that are not, newer ones that normally available at most banks. And so it's a mix of all those things that we are working our way through. We've worked our way through the same situation with commercial, in a way with prepaid, and of course, in the case of debit, in some cases, we were able to get a big deal. In others, this regulatory environment change provided an opportunity to do something. But we're kind of working our way through that. That's how I view that consumer credit question. And Noah, would you like to take on the EU and Visa question a little bit?

Sure, I'd be glad to. So there is a difference, as I understand Visa and their interchange fee structure setting in Europe compared to ours. So Visa's cross-border interchange fees have application to domestic jurisdictions. So as I understand the scope of the European Commission's concerns with Visa, that's why it relates to both the cross-border rates, as well as their domestic rates in some countries. We don't have that approach, so we set individual domestic rates, as well as the cross-border rate. The case that the Commission brought against MasterCard only relates to the cross-border rates. We, as you know, are appealing from the -- the decision from the general court. In the meantime, to specifically answer your question, yes, there is the potential for some pressure from domestic competition authorities. We will continue to dialogue with them. But we think we have, as I said, a strong position on our appeal.

And your next question comes from the line of Moshe Orenbuch with Crédit Suisse. Moshe Orenbuch - Crédit Suisse AG, Research Division: I was hoping, Ajay, to kind of return to that U.S. credit, because given that you'd said mid-teens from the commercial side, it just seems like the consumer side might even be flat to down at this point. I appreciate the comments that you made about banks kind of switching back and forth, but maybe talk a little bit about if you've got specific plans to kind of bring some of that volume back in the second half of the year.

You've got to be kidding if I'm going to give you specific [ph] plans now. That's a good try, Moshe. I'm sorry, I can't answer that question, you know that. Just nothing that I can tell you that I will certainly produce and having all of that tomorrow morning. But we have worked very hard in the other areas and we are working very hard on this one. And we've got a constant drum rate of pipeline out there and we're at it. And don't take all this out of context. I was trying to provide that color to enable you to understand how I viewed our position in the U.S. market over the last few years. I viewed our position 2, 3 years ago, a bit like Chris McWilton laid out at one of our Investor Days, where we had -- frankly, we have lost share in debit, signature and payment. Our credit position was what it was because we were strong with certain banks that are mostly credit card issuers. We were not strong with some banks that are more debit and credit, as in a more holistic money-centered approach. We -- those banks, got sold out by -- bought by other banks that were traditional Visa banks. That didn't help our position. Our commercial position was not where I'd want it to be despite our very good strengths on the commercial product, from smart data as a tool to the fact that our acceptance is way beyond that of the largest players in commercial. And all we have to do is travel outside of the United States and feel that pain. And so in many ways, I felt we weren't taking full advantage of our capabilities in those spaces. And we were making progress in all of them. In that context, in my own personal scorecard, I don't think consumer credit has made as much progress as commercial prepaid and debit. That's the context in which I was speaking.

And your next question comes from the line of Jason Kupferberg with Jefferies & Company. Jason Kupferberg - Jefferies & Company, Inc., Research Division: Just a clarification and a question. The clarification was just what was the pricing impact on revenues in the quarter? And then my question is within Europe, I know you said low teens process volume growth in July, still robust, slipping a little bit versus Q2. Can you give us any qualitative sense underneath that number between debit and credit in Europe? Just if there has been a divergence in the relative growth rates between those 2. I know you won't give us the exact numbers, but just any qualitative trends you can speak to on credit versus debit in Europe, as the macro unfolds there.

Okay, Jason, I can do that. First of all, from a pricing contribution, that was about 2 percentage points, okay? Both on the 9%, as well as on the 13% growth rates for revenues. And there's really no additional pricing in there. It all came out from what we had put in place last year, as well as in January of 2012. From a European, a little bit more clarification point of view, we're really seeing no slowdown from a debit point of view. All of the numbers that we're seeing are more on the credit side. And when I look at the underlying countries, there are really 2 countries that are still growing. They're still growing very nicely but the growth is a little bit less than what we had in the prior couple of quarters. And one is the U.K., and the other one is France.

That concludes the Q&A section of the call. I would like to turn the call over to management for closing remarks.

So let me just leave you with a few of those thoughts. We have -- as I've just been saying in the few questions and answers, I think we've made really solid progress across the globe in the first half of 2012. We feel very good about U.S. PIN debit in particular, even though we don't yet know how those volumes will all finally shake out, for all the reasons we have discussed in the past. Of course, those incremental PIN debit transactions came at a lower than average yields as Martina talked about, but with good profitability. As Martina also mentioned, we think that the second half of the year has got more difficult comparisons as the year progresses, as we lap our strong second half of last year. There is the potential for us to increase our level of investment, depending on how much room we have in our P&L versus the kind of commitments we have out there for our operating targets. That room could come from things such as stronger-than-expected top line growth or the potential lower tax rate that Martina has been talking about. There is no shortage of growth opportunities in this business. The key is to evaluate as many as we can and then act on the ones that provide the best potential for maximizing our long-term growth, and let everything leftover drop straight to the bottom line. That's what we are focused on. Overall, we're working as hard as we can to deliver another good year and meet those performance objectives despite all these continuing uncertain economic conditions. So with that, thank you for your time today, and thank you for your faith in our company.

Ladies and gentlemen, that concludes today's conference. Thank you for your participation. You may now disconnect. Have a great day.