Business digestCompiled from Times wires
© St. Petersburg Times
published May 3, 2002
MORTGAGE DISPARITY: A much larger share of black and Hispanic homeowners with relatively high incomes pay higher interest on their mortgages than whites in similar circumstances, an advocacy group says. The Center for Community Change said its study found that the disparity in mortgage rates between whites and minorities actually widens as homeowners' incomes increase. The report was released as Sen. Paul Sarbanes, D-Md., proposed legislation to curb so-called predatory lending, which critics say especially hurts minorities and the elderly. Steve O'Connor, vice president for government affairs at the Mortgage Bankers Association, said the group was evaluating the study.
PORT RENT DISPUTE: The Tampa Port Authority filed suit in state court against tenant Winner Metals, alleging that the company has breached its lease by failing to pay rent and taxes totalling almost $300,000. The port authority wants a judge to let it take possession of the property and to force the company to pay the past due charges and attorneys' fees. Officials with Winner Metals could not be reached for comment.
MCI TO RAISE RATES: Just days after its chief executive resigned, WorldCom Inc.'s MCI Communications has raised its long-distance phone rates. MCI is doubling its Sunday per-minute rate from 10 cents to 20 cents, raising directory assistance requests to $2.49 per call and boosting per-minute rates and monthly minimum charges on several plans. The increase affects 10 percent of MCI customers, a spokeswoman said, and subscribers to the carrier's two most popular calling plans are not affected. Most new rates go into effect June 1. The price increase has been in the works for months and is unrelated to this week's resignation of chief executive Bernard Ebbers, the company said.
ADELPHIA MAY RESTATE RESULTS: Adelphia Communications Corp. said it plans to restate its 1999, 2000 and 2001 financial results to account for loans the cable-television company backed to the chairman's family. The $1.6-billion in bank borrowings by the family at the end of last year may be added to the balance sheet, the cable-television company said in a statement. The restatement likely will boost Adelphia's debt 11 percent to $16.3-billion and may place the company in violation of terms of its existing borrowing agreements because of the increased liability, analysts said. Adelphia acquired the Pinellas County operations of Americast from Verizon in March. Shares of Adelphia fell 94 cents to $6.01.
CARNIVAL DISCLOSES CHARGE: Carnival Corp. said an air-conditioning problem on the Carnival Spirit is expected to reduce the company's second-quarter earnings by 2 cents a share. The problem caused the early termination of the April 21 12-day voyage of the Carnival Spirit as well as the cancellation of a planned 12-day voyage that was to leave today. Carnival disclosed the expense in a filing with the Securities and Exchange Commission. Analysts expect Carnival to earn 32 cents a share in the second quarter ending May 31, according to Thomson Financial/First Call. Carnival shares fell 94 cents to $33.64.
NEW JOB FOR BURDINES EXECUTIVE: Michael J. Osborn, president and chief operating officer of Burdines since 1994, has been named to a similar post with Macy's West. Both chains are divisions of Federated Department Stores Inc. of Cincinnati. Osborn replaces Robert Mettler, a former Sears, Roebuck and Co. executive who was promoted to chairman and chief executive of Macy's West in San Francisco. Federated said it will name Osborn's successor at Burdines headquarters in Miami shortly.
TROPICAL NAMES CFO: Larry McPherson, 38, has been named chief financial officer of Tropical Sportswear Int'l Corp. He replaces Michael Kagan, who retires in August. McPherson, who joined the Tampa apparel manufacturer when it went public in 1997, was vice president of finance.
HP TO CHANGE SYMBOL: Hewlett-Packard Co. said it will change its trading symbol Monday to HPQ from HWP to reflect the company's purchase of Compaq Computer Corp. Hewlett-Packard is adding the last two letters of Compaq's symbol, CPQ. Trading of Compaq common stock will be suspended before the market opens on Monday, HP said. Shares of Hewlett-Packard rose 23 cents to $17.09. They have dropped 26 percent since the Compaq purchase was announced Sept. 3. Compaq shares rose 11 cents to $10.76.
CHRYSLER KEEPS INCENTIVE PLAN: DaimlerChrysler AG's Chrysler Group plans to continue to offer zero-percent financing on some vehicles, making it the lone U.S. automaker to do so. Chrysler's move came after its two larger U.S. rivals, General Motors Corp. and Ford Motor Co., disclosed they were dropping the no-interest financing plans that the industry embraced last September in the wake of the terror attacks. Chrysler was the last of the Big Three automakers to offer no-interest financing.
IRS AMNITY OFFER NETS $16-BILLION: A government effort to persuade people and companies to come forward with questionable tax shelter arrangements has netted 577 disclosures involving more than $16-billion in claimed deductions, the IRS said. "It exceeded our expectations," said Larry Langdon, commissioner of the Internal Revenue Service's large and midsize business division. About 400 people and 120 corporations were among the taxpayers who voluntarily disclosed shelter arrangements between late December and April 23. The IRS promised in most cases not to seek accuracy-related penalties as high as 20 percent for those who came forward during that four-month window.
JOBLESS CLAIMS SLIDE: New claims for unemployment insurance fell by a seasonally adjusted 10,000 to 418,000, the Labor Department reported. The more stable four-week moving average of new claims, which smoothes out weekly fluctuations, also fell last week to 435,750. Despite the decreases, officials said the numbers continue to be distorted by a requirement that laid-off workers seeking to take advantage of a federal extension for benefits had to submit new claims. Separately, the number of workers continuing to receive unemployment benefits rose to 3.8-million for the work week ending April 20, evidence that people who are out of work are having trouble finding new jobs.
GE UNIT CLOSES DUNEDIN SITE: Partnership Marketing Group, a Schaumburg, Ill., unit of GE Financial Assurance Holdings Inc., closed its Dunedin call center Tuesday, putting 130 people out of work. Employees there sold such products as roadside assistance and supplemental life and health insurance. Spokesman Gene Ullrich attributed the closure to "today's changing economic environment" and a need to cut costs. Most of the work will be absorbed by Partnership's five other call centers, including a 240-person operation in St. Petersburg. Ullrich said there are no plans to close the St. Petersburg office. Workers fired at the Dunedin center will receive severance packages, some benefits and job-hunting help.
FACTORY ORDERS CLIMB: Orders to factories rose for the fourth straight month, with a solid 0.4 percent gain in March, the Commerce Department reported. The figure was largely supported by stronger demand for nondurable goods, such as food, clothes, paper products and chemicals. Orders also rose for metals, construction machinery, household appliances and defense equipment.
GENUITY TO CUT UP TO 1,200 JOBS: Genuity Inc. said it will eliminate up to 1,200 more jobs this quarter, or 29 percent of its work force. Genuity said it also will pare capital spending and may close more data centers and other facilities. Genuity has shed more than 2,800 jobs in the past year and is closing its wholesale Web-access business and ending some European operations. Genuity, which sells high-speed Internet access, was forced to slash expenses after business customers reduced spending during the recession. Shares of Genuity rose 6 cents to 78 cents. They have fallen 71 percent in the past year and are down from a high of $11.25 in June 2000.
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