Business news in brief

QUOTE OF THE DAY “Our soybean supplies will be empty by the end of April. Chinese demand for soybeans

was a lot stronger than everyone expected this year.” Scott Meyer, Ursa Farmers Cooperative grain department manager Article, 1DWal-Mart tests self-serve pickup system

Wal-Mart Stores Inc. is taking a page from its Asda playbook in the United Kingdom, testing “lockers” in the Washington, D.C., area as a place customers can pick up online orders at their convenience.

Asda, acquired by Wal-Mart in 1999 and now Britain’s second-largest supermarket chain, offers home grocery delivery, drive-thru pickup and pickup via lockers, known as “click and collect,” said Wal-Mart spokesman Dave Tovar. In Washington, it’s called the site-to-store self-service locker system. Testing is being done in nine stores in Virginia and one in Maryland.

Customers receive a pickup code when they place orders online. When they arrive to pick up packages, they need only key in the code and sign for the package on a screen. Shoppers have 14 days to pick up orders before they expire and are returned to walmart.com.

Microsoft releases Office apps for iPad

SAN FRANCISCO - Microsoft released an iPad version of its popular Office software suite Thursday, a breakthrough heralding a new era under a chief executive officer who promises to focus more on the devices that people are using instead of trying to protect the company’s lucrative Windows franchise.

Thursday’s unveiling of the much-anticipated iPad apps for Microsoft’s bundle of word processing, spreadsheet and presentation software comes nearly four years after Apple Inc. released the tablet computer that has contributed to a steady decline in sales of desktop and laptop machines running on the Windows operating system.

Microsoft’s decision to relent to persistent demands to make its top-selling software application available on the world’s most popular tablet comes seven weeks after the Redmond, Wash., company appointed Sayta Nadella as its CEO after being led for 13 years by Steve Ballmer.

The Office app for the iPad represents a major step in the right direction for Microsoft, FBR Capital Markets analyst Daniel Ives said. “They finally looked in the mirror and realized they needed to go with the crowd in terms of iPads.”

Like several other analysts, Ives thinks the Office app for the iPad could generate an additional $1 billion in revenue for Microsoft. Although the Office app is free to anyone who wants to read Office’s Word, Excel and PowerPoint programs on the iPad, it will require a subscription to Microsoft’s Office 365 to create and edit documents on the device.

The Office 365 subscriptions cost $70 or $100 annually, with the lower price placing more restrictions on the number and types of devices that can be used.

Fed bars Citigroup from raising dividends

WASHINGTON - The Federal Reserve has barred Citigroup from raising its dividend or boosting its stock buybacks, saying it’s too hard to predict how some parts of the bank’s global operation would fare in a sharp economic downturn.

The decision Wednesday was a setback for Citigroup Inc., one of the nation’s biggest banks, which has been cutting jobs and trimming some businesses in an effort to improve its finances.

Citi was the biggest of five banks whose plans the Fed rejected as part of its so-called stress tests, an annual checkup of the nation’s biggest financial institutions. This year, 30 banks underwent the tests to determine if they have large enough capital buffers to keep lending through another financial crisis.

Citi had asked the Fed’s permission to buy back $6.4 billion in shares through the first quarter of next year and to raise its dividend to 5 cents each quarter, up from 1 cent per quarter now.

New York-based Citigroup was blocked from raising its dividend in 2012, too, after failing its stress test. Later that year, it brought in a new chief executive officer, Mike Corbat, with a mandate to speed up its turnaround.

  • The Associated Press

Bank of America settles, pays $6.3 billion

Bank of America is paying $6.3 billion to settle a lawsuit arising out of troubled mortgage-backed securities it cobbled together and sold to Fannie Mae and Freddie Mac in the runup to the financial crisis.

The bank agreed Wednesday to pay that sum to settle a lawsuit filed on behalf of the two government-sponsored mortgage finance firms by their regulator, the Federal Housing Finance Agency. As part of the settlement, Bank of America will also repurchase mortgage securities from Fannie Mae, the Federal National Mortgage Association, and Freddie Mac, the Federal Home Loan Mortgage Corp., that are valued at about $3.2 billion.

The agreement covers what are known as private-label mortgage-backed securities sold by Bank of America and its affiliated entities, such as Countrywide Financial and Merrill Lynch.

Bank of America said the settlement with the housing regulator was expected to reduce its first-quarter income by about $3.7 billion before taxes. The bank is scheduled to report its earnings April 16.

The settlement with the housing finance agency is the latest in a string of deals that regulators have reached with big banks that sold mortgage securities backed by subprime mortgages, which quickly soured during the housing and financial crises.

Average 30-year mortgage rises to 4.4%

WASHINGTON - Average U.S. rates on fixed mortgages rose this week in the wake of comments by Federal Reserve Chairman Janet Yellen suggesting the Fed could start raising short-term interest rates by mid-2015.

Mortgage buyer Freddie Mac said Thursday that the average rate for the 30-year loan increased to 4.40 percent from 4.32 percent last week. The average for the 15-year mortgage rose to 3.42 percent from 3.32 percent.

Mortgage rates have risen about a full percentage point since hitting record lows roughly a year ago.

To calculate average mortgage rates, Freddie Mac, the Federal Home Loan Mortgage Corp., surveys lenders across the country between Monday and Wednesday each week.

The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

The average fee for a 30-year mortgage was unchanged at 0.6 point. The fee for a 15-year loan also held steady at 0.6 point.

  • The Associated Press

Business, Pages 26 on 03/28/2014

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