Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!americast.com!usa-post Newsgroups: usa-today.banks,americast.usa-today.banks From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: banks Wed, Oct 14 1992 Date: Wed, 14 Oct 92 04:48:25 EDT Message-ID: 10-14 0000 DECISIONLINE: Banking & Economy USA TODAY Update Oct. 14, 1992 Source: USA TODAY:Gannett National Information Network N.C. IS NEW BANKING CENTER: When First Union purchases Dominion Bankshares early next year, Charlotte, N.C., city of 400,000, will be home to two of the USA's 10 largest banks. First Union will move up to No. 9 from No. 11, based on assets. Charlotte-based NationsBank, swelled by its $4 billion acquisition of C&S:Sovran Jan. 2, already is No. 4. Only New York, with five, will have more banks in the top 10 than Charlotte. (For more, see special Banks package below.) FDIC BACKS DOWN ON STANDARDS: The Federal Deposit Insurance Corp.'s board Tuesday yielded to pressure from the banking and construction industries and backed off a proposal to set rigid standards for real estate lending. The board decided to issue general guidelines, with loans outside the guidelines being subject to increased scrutiny. Lenders and borrowers had sent an avalanche of negative mail on the issue. TREASURY SELLS 3-MONTH BILLS: The Treasury Department sold $11 billion in three-month bills at an average discount rate of 2.88% Tuesday, up from 2.67% last week. Another $11 billion was sold in six-month bills at an average discount rate of 2.95%, up from 2.78% last week. Because of Columbus Day holiday, the weekly auction was held Tuesday instead of Monday as usual. DEMAND FOR ISSUES TO PICK UP: Treasury Secretary Nicholas Brady said Tuesday that foreign demand for U.S. Treasury issues will pick up even with higher interest rates overseas. Brady told reporters after an industry gathering that worsening economic conditions in other countries would persuade foreign investors to put their money "in the United States as a safe haven." BROKER SALE METHODS PROBED: The Securities and Exchange Commission, the New York Stock Exchange and the National Association of Securities Dealers are examining methods that brokers use to sell risky mortgage-backed securities to the public, according to an SEC report released Tuesday. The examinations come amid concern that recent declines in interest rates may have heavily cost Wall Street securities firms. CHICAGO ECONOMIST WINS NOBEL: University of Chicago professor Gary Becker, who has applied economic theory to everyday life situations from marriage and divorce to crime, won the 1992 Nobel Economics Prize Tuesday. In awarding Becker the $1.2 million prize, the Swedish Academy of Sciences said Becker had "extended the sphere of economic analysis to new areas of human behavior and relations." SPECIAL PACKAGE ON BANKS: WINSTON ALSO HAS BIG BANK: Charlotte, N.C., is home to NationsBank and First Union, the No. 4 and soon-to-be No. 9 banks in the USA. And just 80 miles away, in Winston-Salem, is another national banking power: Wachovia, one of the nation's most conservative, and respected, bank companies - now 21st largest in the country. The growth of North Carolina's Big Three has been stunning. DIVERSIFIED ECONOMY A BOOST: Ten years ago, NationsBank, then NCNB, was ranked 26 nationally; Wachovia was 39; and First Union 46, according to trade publication American Banker. The catapult: Banks in North Carolina were given a helping hand by a steady, diversified economy - including furniture manufacture, tobacco and textiles - which has avoided the boom-and-bust cycles that destroyed banks in Texas and New England. STATE HAS LIBERAL BANKING LAWS: Even more important are the state's unusually liberal banking laws. North Carolina banks were allowed to open branches wherever they liked in the state. Banks in most other states were hamstrung by laws that limited them to one county or barred them from having more than one branch. Also giving NationsBank and First Union a big boost: Deals with the federal government. BANKS DEAL WITH GOVERNMENT: In 1988, NationsBank bought Texas' failed First RepublicBank from the FDIC. The terms included a tax break that made the deal wildly profitable for NationsBank. Last year, First Union won the bidding for Miami's failed Southeast Banks. That deal with the FDIC strengthens First Union's presence in Florida, considered a banking gold mine, partly because of the wealthy retirees there. (End of package.) LONG-TERM YIELDS RISE: The yield on 30-year Treasury bonds rose to 7.53% from 7.52% Tuesday. The discount rate on three-month Treasury bills rose to 2.84% from 2.82%. Light sweet crude oil dipped 21 cents to $22.09 a barrel on the New York Mercantile Exchange. GOLD CONTINUES TO FALL: Gold prices fell Tuesday after a steep plunge the previous session. On New York's Commodity Exchange, gold bullion fell $1.20 to settle at $344.00 a troy ounce. Republic National Bank of New York reported $343.80, off $2.05. On New York's Comex, it settled at $3.695 a troy ounce, down 3.7 cents from $3.732 Monday. Silver bullion fell in London to a late bid price of $3.72 from $3.76. DOW JONES OPENS ON UPSWING: The Dow Jones average of 30 industrials opens at 3201.42 Wednesday after closing up 27.01 Tuesday. The New York Stock Exchange composite opens at 225.31, up 1.03. The American Stock Exchange market value opens at 366.83, up 0.85. The NASDAQ OTC composite opens at 576.44, up 2.60. DOLLAR OPENS DOWN OVERSEAS: The dollar opens down on Wednesday. It opens at 0.5824 British pounds, down from 0.5933; 4.9785 French francs, down from 4.9870; 1.4650 German marks, down from 1.4855; and 121.25 Japanese yen, down from 121.75. (As of 3 p.m. Tuesday. Source: First American Bank of New York.) 24-HOUR TELEPHONE INFORMATION: USA TODAY Money Hot Line. 95 cents a minute. 1-900-555-5555. Banking & Economy Editor: Beth Mann. (1-919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution purposes violates federal law. This article is copyright 1992 Gannett News Service. Redistribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM