Headlines:
Israel Case Hits E-Trade Profit
E-Trade Financial Corp. said its loss in a $10.2 million arbitration case in Israel will reduce its fourth-quarter earnings by 2 cents a share.
The New York-based online banking and brokerage provider said on Friday that it disagreed with the award and was evaluating its options, including a motion to vacate the award. It announced its fourth-quarter results Jan. 26.
The case involved the 2002 collapse of E-Trade Israel. When its partner in the joint venture failed, E-Trade and the partner sued each other, in 2003, E-Trade reported in a previous filing. It said it had sought damages against the licensee, which it did not identify further, and that the licensee had made a counterclaim.
The arbitration hearing was in October. E-Trade said it received notice on Feb. 1 of a partial award to the licensee of $10.2 million, plus pre-judgment interest of $1.5 million. The tribunal is considering a request for costs and attorney fees.
E-Trade said it will take a pretax charge of $14.5 million against its fourth-quarter earnings. That will reduce its after-tax profit for the period by $8.6 million, from the $98.4 million, or 26 cents a share, it reported last month. For the year E-Trade reported earnings of $389.1 million, or $1.01 a share.
Coinstar Sets Gift Card Rollout
Coinstar Inc. this spring will start rolling out a gift card it tested last year with Starbucks Corp.
Coinstar, of Bellevue, Wash., operates a network of nearly 11,000 computerized coin-counting kiosks, mostly in grocery stores. Under the gift-card program the sponsoring retailer essentially underwrites the cost of the coin-counting service, for which Coinstar typically charges customers a fee of 8.9%. In exchange, the coins' value goes on a card to be used in the participants' stores.
Coinstar said it plans to offer consumers up to three retail gift cards or a branded card from the participating supermarket.
Hollywood Entertainment Corp. of Wilsonville, Ore., a movie-rental chain, will be among the first to offer the gift cards, Coinstar said in a press release issued Thursday. It said it is seeking retailers in other categories and that the full national rollout will take two to three years. Starbucks will be in the rollout as well, Coinstar said.
Sovereign Using SAS Software
SAS Institute Inc. of Cary, N.C., has been hired to help Sovereign Bancorp Inc. of Philadelphia combat money laundering.
SAS said Sovereign will use its analytical software to automate the review of transaction activity companywide.
The $55.8 billion-asset Sovereign has branches in eight states in the Middle Atlantic states and New England. Its hiring of SAS was announced by the software company on Feb. 1.
