Path: bloom-picayune.mit.edu!snorkelwacker.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 Mon, Oct 26 1992 Date: Mon, 26 Oct 92 04:43:26 EST Message-ID: 10-26 0000 DECISIONLINE: Banking & Economy USA TODAY Update Oct. 26, 1992 Source: USA TODAY:Gannett National Information Network TRADE BOARD BANS LEE B. STERN: The Chicago Board of Trade has banned Lee B. Stern & Co. from trading and suspended memberships of the firm's three main owners following more than $1 billion in questionable trades Thursday that shook up the Treasury bond market. Thursday, a floor broker whose trades were guaranteed by Stern & Co., initiated a series of huge trades in 30-year bond options and futures. KEATING HAS TO PAY $1 BILLION: Charles Keating Jr. and two co-defendants must pay $1 billion to thousands of investors who claim they were cheated by Keating's Lincoln Savings, the judge in their federal civil fraud trial has ruled. The final damage figure was announced after federal district judge Richard Bilby calculated the effect on a jury award of federal racketeering statutes calling for triple damages. KEATING ALSO MUST PAY $750M: Federal district judge Richard Bilby has ordered Charles Keating Jr. and two co-defendants to pay $1 billion to investors who say they were cheated by Lincoln Savings. Keating also was ordered to pay plaintiffs another $750 million in punitive damages. The judgment came in a pair of class-action civil lawsuits by investors who lost money investments sold by Lincoln Savings and Loan. SEQUOIA CONTINUES TO SUFFER: Sequoia Systems Inc.'s announcement that it would restate its results for the latest financial year is only one of several self-inflicted blows to the troubled company that has lost three top executives. The Securities and Exchange Commission is investigating its accounting practices. Also, the company has violated a $15 million revolving loan agreement with Bank of Boston. BANK SETTLEMENT NOT APPROVED: A federal district judge Friday refused to approve a settlement of a class-action suit reached between First Investors Corp. and about 400,000 customers of two of the company's junk bond funds in the late 1980s. Judge Mary Lowe was acting at the request of New York's attorney general in refusing to approve the settlement. First Investors allegedly often misled elderly customers. MORTGAGE RATES SOAR: Kicked by rising interest rates, homebuyers are trying to seal their mortgages quickly before rates head any higher. Average rates on 30-year fixed-rate mortgages shot up to 8.23% last week from 8.06% the week before, the Federal Home Loan Mortgage Corp. says. It was the sharpest weekly increase since mid-January. "Lots of undecided people have now decided," says a broker. CITICORP STILL BIGGEST: Citicorp is still the USA's largest banking company, according to third-quarter asset figures. Citicorp ended the quarter with $223 billion in assets, well ahead of No. 2 BankAmerica, which had $187 billion in assets. But analysts say Citicorp's rivals are making acquisitions aggressively and it's likely they will eventually pass Citicorp. Rivals include NationsBank. MACHINE TOOL ORDERS SURGE: Orders for machine tools jumped in September because of a surge in business at the industry's biennial trade show. The Association for Manufacturing Technology says September orders totaled $284 million, a 77% increase from August, and 16% higher than a year earlier. Because of weakening orders from abroad, fourth-quarter orders aren't likely to reach the $798 million level posted in '91. LAYOFFS COULD SET RECORD: Layoffs and job eliminations could reach record numbers next year, according to a survey by the American Management Association. In the survey, a quarter of the 836 companies polled said they were planning work force reductions by June 1993. That's the highest level since the association began its survey of human resource managers six years ago. LONG-TERM YIELDS RISE: The yield on 30-year Treasury bonds rose to 7.63% from 7.61% Friday. The discount rate on three-month T-bills rose to 2.94% from 2.93%. On the New York Mercantile Exchange, platinum gained $1.10 to $359.50 an ounce. Light sweet crude oil fell 16 cents to $21.19 a barrel. GOLD RISES, SILVER FALLS: Gold prices rose Friday. On the New York Commodity Exchange, gold bullion for current delivery settled at $343.60 a troy ounce, up 50 cents from late Thursday. Republic National Bank said gold rose 80 cents to a late bid price of $343.20. On New York's Comex, silver bullion settled at $3.769 a troy ounce, down from $3.781. DOW JONES OPENS ON UPSWING: The Dow Jones average of 30 industrials opens at 3207.64 Monday after closing up 6.76 Friday. The New York Stock Exchange composite opens at 227.83, down 0.27. The American Stock Exchange market value opens at 374.24, down 0.27. The NASDAQ OTC composite opens at 597.30, up 0.18. 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