SAN FRANCISCO (MarketWatch) - MasterCard shares fell more than 10% on Thursday morning after it reported a big charge to cover a legal settlement and analysts said the ongoing credit crisis is clouding the company's near-term outlook.

Rival Visa shares also slipped, falling a more moderate 5% in early trade.

MasterCard Inc. MA, -0.63% on Thursday said a $1 billion charge to settle an antitrust case with American Express Co. drove a second-quarter loss of $746.7 million, or $5.74 a share.

Excluding the charge, quarterly net income was $276 million, or $2.11 a share, the company said.

In the year-ago period, MasterCard reported adjusted net income, excluding special items, of $195 million, or $1.43 a share.

Second-quarter net revenue rose to $1.25 billion from $997 million.

"The impact of moderating cross border transaction growth ... as well as above-average expenses, resulted in below-typical quarterly revenue/EPS upside," Cowen analysts said on Thursday.

"While the near-term outlook for these metrics may be uncertain, we believe that long term, MA's results will continue to benefit from secular growth trends in the electronic payments arena.

Analysts polled by Thomson Reuters had forecast net income of $273 million, or $2.02 a share, on revenue of $1.21 billion.

"The stock is down and some investors might have been expecting a larger beat in the quarter," according to a KeyBanc Capital Markets research report.

MasterCard shares have risen almost 70% in the last 12 months.

MasterCard said its gross dollar volume rose 12.8% on a local currency basis, transactions rose 13.6% to 5.2 billion and cross-border transactions rose 18.9%.

"Businesses, consumers and governments around the world are demonstrating a growing preference for electronic payments, and our cross-border volumes remain healthy as cardholders come to rely on electronic payments," MasterCard CEO Robert Selander said.

"More than 50% of our revenue is generated outside of the U.S., which helps to moderate the impact of an economic downturn in one particular region," Selander added.

The growing use of debit cards around the world is boosting business at the world's biggest transaction processors, as Visa reported a 41% jump in second quarter earnings, and MasterCard said that excluding a legal charge it too earned more money this quarter.

Visa is where it wants to be

Late Wednesday, Visa Inc. reported a 41% jump in quarterly net income late Wednesday as the payment-processing giant continued to benefit from increased use of debit cards and other plastic.

The company said fiscal third-quarter net income came in at $422 million, or 51 cents per Class A share, vs. $299 million a year earlier. Visa was a private company a year ago, so it didn't have publicly traded shares.

Adjusting for certain costs from litigation and other issues, net income was $457 million, or 59 cents per Class A common share, in the latest quarter, the company said.

Visa V, -0.43% was expected to make 48 cents a share, according to a survey of 19 analysts by FactSet Research.

Visa shares fell 4.4%, to $74.93.

The stock has surged since the company sold shares at $44 each in a huge initial public offering in March.

Visa and MasterCard processes payments on debit cards and other types of payment cards and charges fees for these services. Unlike credit card companies, they don't lend money to anyone. That means it hasn't suffered as the global credit crunch begins to dent consumers' ability to repay debt.

"The distance between Visa and other financial-service players can be attributed to two important factors -- a continuation in the decades-long conversion of cash to plastic and the simple fact that Visa not does underwrite credit," Red Gillen, senior analyst with consulting firm Celent, wrote in an email that was sent to MarketWatch.

Net operating revenue in the fiscal third quarter 2008 rose to $1.6 billion, driven by strong contributions from service fees, data processing fees and international transaction fees as payment volumes and processed transactions rose across all regions worldwide, Visa said.