Business news in brief

Workers at a shipping terminal in Tokyo. Japan's exports fell more than expected in July as a global slowdown and a strengthening currency weigh on the outlook for the nation's sales overseas. Japanese Finance Minister Yoshihiko Noda said currency-market intervention said he was ready to act to stem gains in the yen that could derail an export-led recovery.
Workers at a shipping terminal in Tokyo. Japan's exports fell more than expected in July as a global slowdown and a strengthening currency weigh on the outlook for the nation's sales overseas. Japanese Finance Minister Yoshihiko Noda said currency-market intervention said he was ready to act to stem gains in the yen that could derail an export-led recovery. (TOMOHIRO OHSUMI / Bloomberg News)
Posted: August 19, 2011

In the Region

FDIC takes over Public Savings Bank

Public Savings Bank, of Huntingdon Valley, was taken over by the Federal Deposit Insurance Corp. and sold to Capital Bank, of Rockville, Md. The FDIC took the unusual step of closing the bank on a Thursday instead of a Friday, as is typical, because of the bank's close connection to an Orthodox Jewish community, according to an FDIC spokeswoman. Public Savings, which had $45.8 million in deposits on June 30 in one office, is the fourth Philadelphia-area bank to fail since last September. Public Savings was founded in 1928 and has been owned since 2006 by Gelt Financial Corp., an alternative real estate lender, also in Huntingdon Valley, which filed for bankruptcy protection July 25. Public Savings' business in recent years has concentrated on Internet banking and credit cards. The estimated loss to the FDIC's deposit insurance fund is $11 million. - Harold Brubaker

Consol in Marcellus deal for $3.4B

Consol Energy Inc. said it will sell half of its interest in Marcellus Shale drilling in Pennsylvania and West Virginia for $3.4 billion in a deal that gives Noble Energy Inc. its first access to the lucrative Marcellus natural gas market. Under the deal, Houston-based Noble will buy half of Consol's Marcellus development rights and existing wells in those states. The deal involves 663,350 acres that Consol has under lease in both states. - AP

Pa. natural gas production rises 60%

Pennsylvania's Marcellus Shale drilling industry is continuing to post huge gains in production. The state's 1,632 working Marcellus wells produced 432.5 billion cubic feet of natural gas through the first six months of the year, according to Department of Environmental Protection statistics. That's a 60 percent increase over the amount of gas reported for the last six months of 2010. The Scranton Times-Tribune reported that Bradford, Susquehanna, and Tioga Counties led the way with 260 billion cubic feet of gas. Energy firms have been boosting their production targets, not only because new wells are coming on line but also because they are managing to coax more gas from each well. - AP

N.J. unemployment stays at 9.5%

New Jersey's unemployment rate was unchanged at 9.5 percent in July, according to the state labor department. Private-sector employers added 3,900 jobs last month for the sixth straight month of gains, the department said. Government jobs declined by 2,100. - Bloomberg News

Starwood buys 18 Hersha hotels

A unit of New York-based Starwood Capital Group has bought 18 suburban hotels, mostly in Pennsylvania and Connecticut, from Philadelphia-based Hersha Hospitality Trust, for around $54 million in cash and just over $100 million in assumed debt and working capital. The hotels include the 88-room Holiday Inn Expresss in Malvern and three Hampton Inns in central Pennsylvania. The move accelerates Hersha's shift away from small towns in favor of New York, Washington, and other big-city hotel markets, said chief financial officer Ashish R. Parikh. The sale means that, for the first time, more than half of Hersha's business is in the New York City market, said Shawn Kelly, analyst at Bank of America Merrill Lynch. - Joseph N. DiStefano

Wilmington Trust sues Vitro

Units of Vitro SAB, a Mexican glassmaker that defaulted in 2009, were sued by bondholder Wilmington Trust N.A. seeking to recover $1.35 billion owed under notes issued by Vitro. Vitro and its subsidiaries are engaged in a "a multi-year scheme" to avoid paying bondholders, said the complaint, filed in New York state court by Wilmington Trust, which was acquired this year by M&T Bank Corp. Vitro defaulted after the recession cut demand for construction and auto glass. A Vitro spokesman did not immediately respond to an e-mail seeking comment. - Bloomberg News

Elsewhere

Lawyers accused in nationwide scam

California prosecutors filed a major lawsuit against several lawyers and call center operators who allegedly ran a nationwide scam to dupe desperate homeowners into paying thousands of dollars to join dubious lawsuits against some of the country's largest banks. The complaint accuses prominent foreclosure attorneys Philip Kramer and Mitchell Stein and at least 17 other individuals and businesses of luring borrowers into a scheme that falsely promised a cut of future settlements. No criminal charges have been filed in connection with the case. - AP

HP getting out of smartphones

Hewlett-Packard Co. said it would end its tablet and smartphone businesses, and is considering selling its PC business. HP has been rumored for six months to have been in talks to spin off or sell its PC business, but the smartphone and tablet announcement was surprising. HP paid $1.8 billion for smartphone maker Palm in 2009, mostly for the webOS software that powered the devices. HP, the biggest maker of PCs and printers, has been trying to transform itself to focus more on technology services, much as IBM Corp. did a decade ago. PCs are HP's biggest revenue generator, but the division is the least profitable among the company's major divisions. - AP

Exxon sues over canceled oil leases

Exxon Mobil Corp. sued the U.S. Interior Department in federal court asking a judge to set aside the agency's decision to cancel offshore leases that may yield "billions of barrels of oil." The department overstepped its authority in ruling that Exxon Mobil was not developing some Gulf of Mexico oil leases quickly enough, the company says in its complaint. It said federal regulations allow oil producers to suspend production in their fields, partly "to facilitate proper development of a lease." The Interior Department said it was reviewing the complaint. - Bloomberg News

AIG repays $2.15B to government

American International Group Inc. has paid the federal government $2.15 billion this week after selling off a life insurance subsidiary, trimming its financial bailout balance to roughly $51 billion. AIG has now paid back $11.4 billion of the $68 billion in bailout funds it received from the government at the height of the 2008 financial crisis. The government sold 200 million AIG shares in May. - AP

|
|
|
|
|