The Federal Reserve on Monday granted a request by American Express Co. to become a bank holding company, opening the door for the credit card giant to accept deposits and permanently access financing from the Fed. The Fed said it had approved the application for American Express and a related company, American Express Travel Related Services Co. Inc., to become bank holding companies. The Fed's approval for American Express was similar to the decision it made in September to transform the country's two biggest investment banks, Goldman Sachs Group Inc. and Morgan Stanley, into bank holding companies.
Bloomberg News sues Fed for details on loans Bloomberg News has sued the Federal Reserve for refusing to identify the recipients of almost $2 trillion in emergency loans from American taxpayers or the troubled assets the central bank is accepting as collateral. Fed Chairman Ben Bernanke and Treasury Secretary Henry Paulson said in September they would comply with congressional demands for transparency in a $700 billion bailout of the banking system. "The collateral is not being adequately disclosed, and that's a big problem," said Dan Fuss, vice chairman of Boston-based Loomis Sayles & Co., where he co-manages $17 billion in bonds. "In a liquid market, this wouldn't matter, but we're not. The market is very nervous and very thin." Bloomberg requested details of the Fed lending under the U.S. Freedom of Information Act and filed a federal lawsuit Friday seeking to force disclosure.
USDA trims corn, soybean harvest forecasts The Agriculture Department lowered its forecasts for this year's U.S. corn and soybean harvests, with corn production now expected to come in below analysts' estimates. The department said corn production is expected to be 12.02 billion bushels, down from last month's revised estimate of 12.03 billion and below analysts' estimates of 12.08 billion. Corn yield per acre is expected to come in at 153.8 bushels, down from last month's estimate of 153.9. The soybean harvest is forecast to be 2.92 billion bushels, down from 2.94 billion, according to the USDA's November report. The new projection matched analysts' estimates. Soybean yield per acre is expected to be 39.3 bushels, down from 39.5 last month.
McDonald's sees jump in same-store sales Consumers worldwide who are watching their spending bought more burgers and chicken breakfast biscuits at McDonald's in October, leading to a big rise in sales at established locations for the fast-food leader. McDonald's Corp. said Monday its global same-store sales jumped 8.2 percent during the month. That beat the company's own prediction for a rise similar to the one it recorded in its last quarter, when same-store sales, or sales at locations open at least a year, jumped 7.1 percent worldwide.
HSBC global profit up despite write-downs HSBC Holdings PLC, Europe's largest bank by market value, said Monday it had been forced to write down the value of its assets by $4.9 billion in the third quarter, as the cost of bad loans in the United States continued to mount and the credit market faltered. However, despite the write-downs, HSBC said that third-quarter profit was higher this year than it was a year earlier because of strong growth in Asia and asset sales, which offset the declining U.S. performance. "Asia remained at the heart of core operating profitability of the group in the quarter," the London-based bank said in a regulatory statement.
