Exhibit99.4

 

Report of Management on Compliance

 

 

# **March 15,2007**

 

We, as members of management of Target NationalBank, as servicer, are responsible for complying with the administration andservicing requirements of Article III, Article IV and Section 8.8 of theAmended and Restated Pooling and Servicing Agreement, dated April 28, 2000(as may be amended and supplemented from time to time, the “Pooling and Servicing Agreement”) and the applicableprovisions of the Series 2002-1 Supplement, dated July 2, 2002, and the Series2005-1 Supplement, dated November 9, 2005 (together, the “Supplements”) to the Target Credit Card Master Trust asset forth in Exhibit A.  We also areresponsible for establishing and maintaining effective internal control overcompliance with the administration and servicing requirements of Article III,Article IV and Section 8.8 of the Pooling and Servicing Agreement and theapplicable provisions of the Supplements, as set forth in Exhibit A.  We have performed an evaluation of Target NationalBank’s compliance with the requirements of the administration and servicingrequirements of Article III, Article IV and Section 8.8 of the Pooling andServicing Agreement and the applicable provisions of the Supplements as setforth in Exhibit A, as of December 30, 2006 and for the fiscal year thenended.  Based on this evaluation, weassert that as of and for the fiscal year ended December 30, 2006, TargetNational Bank complied, in all material respects, with the administration andservicing requirements of Article III, Article IV and Section 8.8 of thePooling and Servicing Agreement and the applicable provisions of theSupplements, as set forth in Exhibit A.

 

 

Verytruly yours,

 

 

/s/Terrence J. Scully

TerrenceJ. Scully

President,Target National Bank

 

 

/s/Angela G. Jenks

AngelaG. Jenks

VicePresident and Cashier,

TargetNational Bank

 

Exhibit99.4

 

ExhibitA

 

 

**Servicing Standards**

 

 

Management of the Bank identified thefollowing standards which are, in management’s opinion, applicable to servicingcredit card receivables and consistent with the applicable provisions ofArticle III, Article IV and Section 8.8 of the Amended and Restated Pooling andServicing Agreement, dated April 28, 2000 (as may be amended and supplementedfrom time to time, the “Agreement”), as supplemented by the Series 2002-1Supplement, dated July 2, 2002, and the Series 2005-1 Supplement, datedNovember 9, 2005, to the Target Credit Card Master Trust (together, the “Supplements”).

 

 

**I.****         ****FinanceCharges**

 

1.     Finance charges are calculated in accordance withthe applicable cardholder agreements based on cardholder average dailybalances.

 

2.     Finance charges areaccurately reflected on the customers’ monthly billing statements.

 

**II.****       ****InvestorAccounting and Reporting**

 

1.     The monthly certificateholders’ statements areprepared and sent to investors or trustees on a monthly basis.

 

2.     The annual and monthly certificateholders’statements reconcile to the servicers’ accounting records.

 

3.     The annual and monthly certificateholders’statements are mathematically accurate and are prepared in accordance with theapplicable provisions of the Agreement and the Supplements.

 

Exhibit 99.4

 

**III.****      ****Accounting**

 

1.     The servicing entity’s records of individual creditcard receivable balances  agrees with, orreconciles to, the records of debtors with respect to the unpaid principalbalance.

 

 

**IV.****      ****Write-Offs**

 

1.     Write-offs of cardholder balances are completedwithin the applicable Office of the Comptroller of the Currency regulations andaccounting principles generally accepted in the United States.