Morning Scan
Wednesday, November 18, 2009
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Receiving Wide Coverage ...
Goldman's Rehabilitation: Goldman said it is launching a $500 million small-business assistance program that includes an advisory panel with billionaire investor Warren Buffett. The papers portrayed the program as an attempt to appease public anger over the firm's compensation. The Times said, "After first staunchly defending its outsize profits and pay, and then bristling at calls for restraint in these tough economic times, Goldman is trying a new tack: It is apologizing for past mistakes that led to the financial crisis — and sharing at least some of its riches." Wall Street Journal, New York Times, Washington Post
A separate story in the Journal highlighted a government report dispelling Goldman's claims that it wouldn't have suffered material losses had the government allowed one of its major trading partners, AIG, to collapse.
Regulatory Revamp: The House Financial Services Committee approved an amendment Tuesday that the committee's chairman said would curtail the powers of Federal Reserve regional bank presidents. The Journal noted that it differs from legislation unveiled last week by Senate Banking Committee Chairman Chris Dodd, which would strip away virtually all of the Fed's bank-supervision and consumer-protection powers. An editorial in the Times praised Dodd's plan for regulatory reform for being "stronger" than the House version on aspects of derivatives regulation and consumer protection, but said the proposal "is just a draft. Senators will have to stand up to pressure from banking and business lobbies, which surely will try to weaken the beneficial parts of the plan as it makes its way through the legislative process. On that score, the experience in the House has not been encouraging." Wall Street Journal, New York Times
Wall Street Rebound: The New York state comptroller released a report Tuesday showing that Wall Street is recovering more quickly than anticipated. The Times' coverage focused on the overall strength in earnings' which are on track to exceed the record set three years ago, at the height of the credit bubble The Journal focused on Wall Street's willingness to hire again. It noted that New York City's securities industry grew by 3,600 jobs in September, the biggest increase since 2002. Wall Street Journal, New York Times
Tax Amnesty: The IRS said Tuesday that more that 14,700 Americans had been attracted to an amnesty program in for offshore account holders — many more than had been attracted to a previous IRS program. Wall Street Journal, New York Times
UBS' Game Plan: The Swiss banking giant, which has taken a hit to its reputation as a result of its legal dispute with the U.S. over helping wealthy Americans evade taxes, laid out plans to return to profitability: CEO Oswald Grübel set a target of $14.89 billion in annual pretax profit within three to five years. The Journal said, "In setting out profit targets, Mr. Grübel hopes to restore investor confidence in the bank, and in turn stanch the outflow of assets." Wall Street Journal, New York Times
Lazard Names Successor: Lazared named Kenneth M. Jacobs chairman and chief executive, putting the 51-year-old American in the role vacated after the death of famed deal maker Bruce Wasserstein. The Journal said, "In choosing Mr. Jacobs, Lazard's board selected a steady hand with a solid reputation among Wall Street's coterie of deal makers." The Times said, despite its history of internal strife, "no fireworks accompanied Lazard's announcement." It added, People inside and outside the investment bank describe Mr. Jacobs as a strategic thinker who would maintain Lazard's independence and business model, one not reliant on a big balance sheet and voluminous lending." Wall Street Journal, New York Times
Wall Street Journal
Efforts to spur job creation need to center on getting more credit — and fast — to small and midsize businesses and improving the country's education system, according to a group of business leaders at the annual Wall Street Journal CEO Council.
The deteriorating commercial real-estate market is hitting Fannie Mae and Freddie Mac.
Pacific Investment Management Co. has won a coveted assignment to help state regulators size up risk in residential-mortgage bonds held in insurers' portfolios, a role for years held by the major ratings firms.
"Plots & Ploys" said a ruling that Citigroup must resume lending to a stalled Syracuse, N.Y., mall project could push banks to revisit how they draft construction-loan agreements.
When the subprime-mortgage crisis hit in the U.S., HSBC Holdings PLC's U.S. unit foreclosed on thousands of homes, many of which it then couldn't unload. Now, there are modest signals that the bank is having an easier time reselling those homes and recouping losses.
New York Times
A front-page article profiled a Philadelphia program begun last year to keep people in their homes: "Under the rules adopted by Philadelphia's primary civil court, no owner-occupied house may be foreclosed on and sold by the sheriff's office before a "conciliation conference," a face-to-face meeting between the homeowner and the lender aimed at striking a workable compromise. Every homeowner facing a default filing is furnished with counseling, and sometimes legal representation. … In a nation confronting a still-gathering crisis of foreclosure, Philadelphia's program has emerged as a model that has enabled hundreds of troubled borrowers to retain their homes."
Washington Post
Top Obama administration officials on Tuesday announced a new federal task force to combat financial fraud.
Troubled homeowners are more likely to avoid foreclosure if they have received housing counseling, a study to be released Wednesday found.
, with contributions from Maria Aspan and Cheyenne Hopkins.
