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Banks Hit for Credit Union Ills - (online.wsj.com) Federal regulators are blaming Wall Street's biggest firms for the collapse of five institutions at the heart of the nation's credit-union industry and are seeking to recoup tens of billions of dollars in losses on securities that doomed the five. In one of the broadest accusations that Wall Street helped cripple financial institutions during the crisis, the National Credit Union Administration, or NCUA, has threatened to sue several investment banks unless they refund over $50 billion of mortgage-backed securities sold to the five institutions, called wholesale credit unions. The NCUA is accusing Goldman Sachs Group Inc., Bank of America Corp.'s Merrill Lynch unit, Citigroup Inc. and J.P. Morgan Chase & Co. of misrepresenting the risks of the bonds to wholesale credit unions, which loaded up on the bonds in their role of investing on behalf of retail credit unions, according to people familiar with the situation. Regulators seized the five wholesale credit unions in 2009 and 2010, inheriting a pile of battered bonds now worth only about $25 billion, or half of their face value.
Egypt stocks slump 10% as market reopens - (www.marketwatch.com) Egyptian stocks tumbled nearly 9% Wednesday when the market reopened for the first time since late January and investors reacted to the political upheaval of the past two months. The EGX 30 stock index (XX:EGX30 0.00, 0.00, 0.00%) closed down 8.9% at 5,142.71, according to the website of the Egyptian Exchange. The Egyptian market slumped nearly 10% at the open and shortly afterwards trading was halted for 30 minutes, according to reports. The broader EGX 100 index ended down 9%. The exchange had closed Jan. 27 amid the turmoil surrounding and following the resignation of former President Hosni Mubarak. Mubarak had been in power for 30 years before the pro-democracy demonstrations sweeping the Arab world reached the country and forced him to step down. The Egyptian exchange had postponed its reopening a number of times. In February, the exchange regulator, the Egyptian Financial Supervisory Authority, put in place some rules for reopening the bourse.
New home sales plunge to record low in February - (www.reuters.com) New single-family home sales unexpectedly fell in February to hit a record low and prices were the lowest since December 2003, showing the housing market slide was deepening. The Commerce Department said on Wednesday sales dropped 16.9 percent to a seasonally adjusted 250,000 unit annual rate, the lowest since records began in 1963, after an upwardly revised 301,000-unit pace in January. Sales plunged to all-time lows in three of the four regions last month. Economists polled by Reuters had forecast new home sales edging up to a 290,000-unit pace last month from a previously reported 284,000 unit rate. "It's been a disappointing February for home sales and there are no signs of a turnaround," said Kurt Karl, chief U.S. economist at Swiss Re in New York. "We're going to have a continuing slowdown in the next few months, but people will start to feel better in the second half of the year and construction and sales should do better later this year and into next year."
Fed’s Fisher Sees ‘Extraordinary Speculative Activity’ in U.S. - (www.bloomberg.com) Federal Reserve Bank of Dallas President Richard W. Fisher said he sees “extraordinary speculative activity” in the U.S. after the central bank pumped record amounts of stimulus into the economy. “There is an enormous amount of liquidity sloshing around,” the regional bank chief, who votes on monetary policy this year, said in a speech today in Berlin. “There is abundant liquidity in the machine we know as the United States economy.” The Fed will likely complete its planned $600 billion of Treasury purchases in June, Fisher said, reiterating his view that no further monetary stimulus will be needed after that. The 62-year-old bank president has criticized the plan, which policy makers voted to keep in place after their March 15 meeting in Washington.
BofA Says Fed Objected to Planned Dividend Increase in 2011 - (www.bloomberg.com) The Federal Reserve objected to Bank of America's plans to boost the dividend and told the bank to revise its proposal, sending its shares down more than 2 percent in New York trade. BofA had hoped to be in a second wave of banks raising dividends in the second half of this year. Unlike some of its major rivals, BofA is still struggling to be consistently profitable and, by some measures, has less capital than many of its competitors. The largest U.S. bank by assets said it intends to submit a revised proposal to the Fed and still hopes to increase its dividend in the second half of the year. The news, disclosed by BofA in a regulatory filing on Wednesday, highlights the split between the largest U.S. banks.
OTHER STORIES:
China Demand for Gold Might Drive Consumption to Match India, World No. 1 - (www.bloomberg.com)
Eurozone bonds face boycott by investors - (www.ft.com)
Portugal Faces Lawmaker Vote Threatening to Push Toward Election, Bailout - (www.bloomberg.com)
Japan's Quake Damage May Swell to $309 Billion, Four Katrinas - (www.bloomberg.com)
BOE Voted 6-3 to Hold Rate, Saw ‘Merit in Waiting’ on Policy - (www.bloomberg.com)
U.S. airlines cut capacity to battle fuel costs - (www.reuters.com)
Tokyo Warns on Water as Radiation Hampers Nuclear Cleanup - (www.bloomberg.com)
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