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Following the lead of big banks like Wells Fargo, Bank of America and Bank One, the nation's largest regional EFT networks continue to consolidate. "Ultimately, I think we'll be left with three to five networks in a span of five years," said Phil Valvardi, president of the MAC network. Memphis-based Concord EFS, Inc., MAC's owner, recently announced plans to purchase Chicago-based Cash Station, Inc., the seventh-largest EFT network in the U.S. The companies expect to get regulatory approval in the next month or so. The combined network will switch about 170 million ATM and POS transactions a month. That compares to about 220 million a month for the Star System and 60 million a month for NYCE, according to Bank Network News. Both Star, the nation's largest EFT network, and NYCE were involved in expansion deals of their own last year. San Diego-based Star merged with Honor Technologies Inc. of Maitland, Fla., and Woodcliff, N.J.-based NYCE bought Magic Line of Dearborn, Mich. NYCE just announced a deal to buy X Press 24, a Massachusetts network with 116 ATMs owned by 53 small financial institutions, from FleetBoston Financial Corp. "Each time there's a network consolidation, I think some of the existing networks look inside of themselves and ask whether it makes sense to continue as a stand-alone, or would it be better for the clients and the shareholders to do something different," Valvardi said. That was definitely the case with Cash Station, said Stephen Cole, the network's president and CEO. "Looking at the long term, we asked ourselves the question 'does business as usual make sense?' We looked at a variety of options and pretty quickly concluded that we needed to trade up." A "watershed event" in the decision-making process, Cole said, came when Cash Station was offered an opportunity to become an owner in an Internet brokerage. "Given our scale, the financial risk was just too big, and we regretfully took a pass." Larger networks "have the capital and scale to invest in new products," he added. A prominent example is the new SafeDebit product, developed by NYCE, which is designed to facilitate PIN-based debit purchases over the Internet. Cash Station's members and employees "will benefit from access to Concord's capital to move this network, even though it will be under a different brand, to the next level of technical sophistication," Cole said. The acquisition will help Wilmington, Del.-based MAC expand its presence in the Midwest and essentially lock up the Chicago metro area, which is dominated by Cash Station. More importantly, Valvardi said, it's "an opportunity for product expansion within the membership base." MAC does all of its own transaction processing, for example, and will offer that service to Cash Station members. Cash Station had outsourced its processing to EDS of Plano, Texas. Many of the other EFT networks are altering their charters to move toward a more profit-oriented business model, Valvardi said. "I think they do see the value (in that model)." That's not true of all networks, however. Johnston, Iowa-based Shazam, a not-for-profit cooperative owned by about 1,000 community banks, thrifts and credit unions, has no desire to change its business model or to become part of a larger network. "Our board of directors has always held the position that the network is not for sale," said Rick Jenkins, Shazam's corporate counsel. Jenkins said that Shazam, which has the exclusive endorsement of community banking organizations in six states, can and will continue to grow by offering its participants a variety of services as a neutral provider. "We're not going to accept a core market area and be content with that," he said.