National business briefs

Washington Mutual raises $7 billion The nation's largest savings and loan, Washington Mutual, said Tuesday that it had raised $7 billion in capital through an investment group led by private equity firm TPG. It added that it would slash its quarterly dividend to a penny from 15 cents and that it would stop buying mortgages from brokers. It also plans to close all of its freestanding loan offices and said that a founder of TPG, David Bonderman, would join the board. Shares of the bank fell $1.34, or 10.2 percent, to close at $11.81.

Realtors say pending sales lowest since 2001 The National Association of Realtors said pending U.S. home sales fell in February to the fewest since the index began in 2001. The Realtors' seasonally adjusted index of pending sales -- sales not yet closed -- for existing homes fell to 84.6 from January's upwardly revised reading of 86.2. A year earlier, the index was 107.6. Wall Street economists surveyed by Thomson/IFR had predicted a reading of 86.3. A reading of 100 is equal to the average level of sales when the index started. The previous low was August's reading of 85.8.

Mack says credit crisis may be nearing end Morgan Stanley Chief Executive John Mack said Tuesday that Wall Street is facing the most difficult conditions he has seen in 40 years, but he feels the global credit crisis might be "in the final innings." Mack, who easily won re-election to Morgan Stanley's board along with 10 other directors, said at the investment bank's annual meeting in Purchase, N.Y., that he still plans to "go slow" because of the market's turbulence. The bank has written wrote down billions of dollars in securities linked to subprime mortgages and other debt since last year.

Fear of deep recession led to Fed rate drop Worries about a deep recession -- not a shallow one -- drove Federal Reserve policymakers to slash a key interest rate last month, meeting minutes show. Even as the Fed battled in almost unprecedented fashion to stem a widening credit and housing slump, some members fretted over the possibility of a "prolonged and severe" economic downturn. It was in that environment that they voted -- with two dissents -- to cut the Fed's most important interest rate by three-quarters of a percentage point to 2.25 percent. That action capped the most aggressive Fed intervention in a quarter-century.

Euro may displace U.S. dollar in world use The dollar is at risk of being surpassed by the euro as the world's leading reserve currency in the next seven years, according to a study published by the National Bureau of Economic Research. Realized and forecast increases in the number of nations using the euro, and growth in the economies that have adopted it since 1999, make the 15-nation currency a stronger competitor than were the German mark and Japanese yen in the 1980s, economists Menzie Chinn and Jeffrey Frankel wrote in a working paper for Cambridge, Mass.-based NBER.