The Star Online: Business
The Star Online: Business |
- Mexican income fell 12 pct during global crisis
- Bank profits up as card customers improve payments
- Primus set to re-appeal
| Mexican income fell 12 pct during global crisis Posted: 15 Jul 2011 09:20 PM PDT MEXICO CITY (AP) - Mexican researchers say the average income in Mexican homes fell just over 12 percent during the global economic crisis. The National Institute of Statistics and Geography says average household quarterly income had risen before 2008, reaching 39,823 pesos, or about $3,400. But it then fell to 34,936 pesos by 2010. The study says the richest 10 percent of Mexicans suffered the biggest drop in income, falling nearly 18 percent. It theorizes that could be because wealthy Mexicans had more investments in the U.S. housing market. Poor Mexicans had a smaller drop - about 7.5 percent - but might have had more trouble compensating for their losses. As of 2008, some 47 percent of Mexicans lived in poverty. Full Feed Generated by Get Full RSS, sponsored by USA Best Price. |
| Bank profits up as card customers improve payments Posted: 15 Jul 2011 09:18 PM PDT NEW YORK (AP) - The top U.S. credit card companies are seeing a boost to their bottom lines as consumers are getting better about paying their bills on time. Five of the top six card issuers on Friday said the rates at which their customers defaulted on their accounts fell in June. Bank of America Corp. reported the biggest drop in defaults, with JPMorgan Chase & Co. and Discover Financial Services also showing significant improvement. Late payments were also down. Only Capital One Financial Corp. saw an uptick in payments late by 30 days or more, and that increase was tiny. Among the top six, only Citibank had not yet submitted its monthly regulatory filing detailing card performance for the month. Its parent, Citigroup Inc., reported second-quarter results earlier in the day, however, giving some insight into its card performance. The latest data followed reports that show credit card users have far better payment habits than a year ago, when the industrywide charge-off rate peaked at 10.9 percent, according to Federal Reserve data. For the first three months of this year, that rate was down to 6.96 percent - a significant improvement, but still well below the industry average of 3.82 percent before the recession, which indicates banks will benefit further as default and delinquency rates further improve. And they should continue to do so. Banks have already written off the balances of most customers expected to default, and those individuals have a hard time getting new credit. The impact of the improved payment habits was reflected in banks' second-quarter financial results this week. Citigroup said that it pulled $757 million out of the pool set aside to cover uncollectable credit card bills, adding to its $3.3 billion profit for the quarter. That followed a report from JPMorgan Chase on Thursday, which posted a $5.4 billion profit for the period, boosted by a $1 billion reduction in loss reserves. And much of Capital One's 50 percent profit leap reported Tuesday was due to the $579 million it released from reserves. Analyst Henry Coffey of Sterne Agee estimated 81 cents of the $1.97 per share profit, or about 41 percent, came from that reserve release. Last month, Discover Financial Services said it released $401 million from its reserves, helping to more than triple the company's second-quarter profit. Also goosing bank bottom lines: Card holders are using their credit cards more. That trend is now clear, after 51 percent of the U.S. card market has reported its second-quarter results, said Morgan Stanley analyst Glenn Fodor. Citigroup said purchase volume rose 1.5 percent. JPMorgan Chase's customers spent 10 percent more using their cards. Discover said sales volume on its namesake cards rose 9 percent. Bank of America and American Express Co. are slated to report next week, and both are expected to show similar gains in spending. The Federal Reserve said total balances on revolving credit, which is mostly cards, rose slightly in May to $793.13 billion. That's still nearly 19 percent below the peak balances of $973.64 billion in August 2008, but reflected an uptick in spending after months of belt-tightening by consumers. What's less clear is if the higher spending will continue. Borrowing is typically a sign of confidence in the economy, and the weak jobs market and higher unemployment last month may discourage further spending. And even when the recovery gains steam, few economists say they expect consumers to pile on debt again after spending the last two years paying it down. Full Feed Generated by Get Full RSS, sponsored by USA Best Price. |
| Posted: 15 Jul 2011 07:39 PM PDT PETALING JAYA: Primus (M) Sdn Bhd is seeking leave to appeal against the Court of Appeal's earlier decision which unanimously dismissed its two appeals with costs involving matters related to the RM5.06bil disposal of the assets and liabilities of EON Capital Bhd (EON Cap) to Hong Leong Bank Bhd (HLB). The announcement was made by EON Cap yesterday to Bursa Malaysia. It is understood that if this application of leave to appeal fails, Primus will not be allowed to proceed with further appeals. On June 20, the Court of Appeal had unanimously dismissed Primus' two appeals with costs involving matters related to the disposal. The first dismissed appeal was for the decision by the High Court, on Jan 31, that ruled the resolutions passed at EON Cap's EGM held on Sept 27, 2010 as valid. The EGM was held to vote on the sale of EON Cap's assets and liabilities to HLBB and also a proposal to distribute cash arising from the proposed sale. The second dismissed appeal was for the decision by the High Court that had earlier dismissed with costs the petition filed by Primus against EON Cap and its directors over the takeover offer by HLB for the entire assets and liabilities of EON Cap on April 28. Primus which is the single largest shareholder of EON Cap which holds 20.2% stake, was said to be against the disposal of the assets and liabilities of EON Cap to HLB because it had bought its stake in the banking group at a higher price. The sale of EON Cap to HLB however has since been completed. Full Feed Generated by Get Full RSS, sponsored by USA Best Price. |
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