Corinthian
College Students Await Their Fate as Breakup Looms - (www.bloomberg.com) Corinthian Colleges Inc. (COCO)’s 72,000 students will soon be swept into the
biggest collapse the U.S. for-profit education industry has ever seen. Jessica
Arellano, 30, a medical assistant student at Corinthian’s Everest
College in
West Los Angeles, said on Friday that she wasn’t aware of the company’s
situation and that she received a confusing e-mail last week assuring her that
classes and student aid would continue as usual. “I’m going to ask some
questions now, ” said Arellano, of Culver City, California. Corinthian, which
also owns the Heald and WyoTech career schools, as well as an online
university, is scheduled to present a plan to the Education Department today to
sell most of its 107 campuses and close others. The wind-down comes after the
U.S. Department of Education cut Corinthian’s access to student aid following
more than a decade of complaints.
Pennsylvania
Governor Won’t Sign Budget, Citing Pensions - (www.bloomberg.com) Pennsylvania Governor Tom Corbett refused to sign a
$29.1 billion budget for the fiscal year beginning today because it doesn’t
reduce pension costs. Corbett, a 65-year-old Republican, said he would work
with the legislature his party leads on “meaningful pension reform,” in a
statement released yesterday after both chambers voted on the spending plan. “I
am withholding signing the budget passed by the General Assembly while I
deliberate its impact on the people of Pennsylvania,” he said. Pennsylvania’s
government remains open as there’s no immediate impact from a lack of a budget
at the beginning of the fiscal year. Financing retiree benefits is a deepening
challenge for localities nationwide as they recover from the 18-month recession
that ended in 2009. Governments last year paid more for pensions, 83 percent of
their required annual contributions, up from 81 percent a year before, while
the systems had about 72 percent of the money needed to meet retirement
obligations, unchanged from the year before, the Center for Retirement Research
at Boston College said.
EU
Backs State Aid for Bulgarian Banks as Lender Targeted - (www.bloomberg.com) The
European Union gave Bulgaria authority to provide 3.3 billion lev
($2.3 billion) in state aid for lenders after police there arrested men they
said triggered a run on deposits of the third-largest bank. The central bank
overcame a run on deposits caused by an “organized criminal attack” against
several banks, it said in a statement today. Earlier, queues formed outside
some Sofia branches of First Investment Bank AD, which paid 800 million lev to
clients on June 27. Bulgaria asked the European Commission to support the credit line a week after the central bank put
fourth-largest Corporate Commercial Bank AD under administration after a big
depositor withdrew funds. “Last week, it transpired that certain individuals
have been targeting the third-largest bank, urging customers to withdraw their
deposits,” the European Commission said in an e-mailed statement. “This created
concerns about the liquidity of the bank in question and risked spilling over
to some other institutions, despite the fact that the Bulgarian banking system
is well capitalized and has high levels of liquidity.”
Puerto
Rico’s Default Plan May Spread Pain Beyond Utility - (www.bloomberg.com) The
U.S. municipal-bond market begins the week wondering whether the Puerto Rico Electric Power Authority, the
commonwealth’s sole provider of electricity, will pay bondholders tomorrow
after lawmakers last week enacted debt-restructuring legislation. If the
utility known as Prepa fails to act, the blow would be the latest absorbed by
investors buffeted by bankruptcies in Jefferson County, Alabama, and Detroit. The defaults call into question the
underpinnings of the $3.7 trillion market. “Puerto Rico has crossed the
Rubicon; it’s crossed the line,” Richard Larkin, director of credit at
Fairfield, Connecticut,
investment firm Herbert J. Sims & Co., said from his office in Boca Raton,Florida. “This is absolutely a big deal and bigger
than Detroit and bigger than Jefferson County because there’s more money
involved.”
Puerto
Rico Swap Cost at Record High Before Bond Payments - (www.bloomberg.com) Investor
confidence in Puerto Rico’s ability to repay debt is sinking as the cost to
protect commonwealth bonds against default has more than doubled since June 12
to the highest ever. Puerto Rico Electric Power Authority bondholders are
awaiting payment today on maturing debt after legislators last week enacted a
law meant to allow some government entities to restructure outside bankruptcy.
A revision of Prepa’s $8.6 billion in debt would be the largest ever in the
$3.7 trillion municipal-bond market. Prices on some Prepa bonds increased
today, data compiled by Bloomberg show.
U.S.
government to unveil near $9 billion fine for France's BNP: sources - (www.reuters.com)
GM recalls thousands of new pickups, SUVs, in U.S. and Canada - (www.reuters.com)
GM recalls thousands of new pickups, SUVs, in U.S. and Canada - (www.reuters.com)
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