PNC will pay $7.1 million in underwriting settlement
The U.S. Justice Department said Pittsburgh-based PNC Bank agreed to pay $7.1 million to settle claims that it failed to engage in prudent underwriting practices when making loans backed by the Small Business Administration. The settlement involved 64 SBA loans PNC approved in 2005 for Uni-Mart stores, located primarily in the mid-Atlantic region. The U.S. alleged that PNC relied on unaudited financial statements for the loans, of which 36 defaulted. Uni-Marts filed for Chapter 11 bankruptcy in 2008. Under the settlement, PNC did not admit or deny wrongdoing.
S&P: Highmark remains at 'A,' but outlook negative
Standard & Poor's Ratings Services has affirmed its "A" rating for insurer Highmark Inc., but revised its outlook from stable to negative. In a press release, S&P analysts said the revision "reflects our expectation that Highmark's operating earnings will weaken further in 2013" due to concessionary pricing in extending its contract with UPMC, expenses related to its plans to build an integrated health care delivery system and preparations for national health care reforms. The agency does expect Highmark's operating earnings to improve in 2014.
Spinoff nets $900M for PPG Industries
PPG Industries received about $900 million in cash and reduced the number of its shares outstanding by 7 percent after completing the spinoff of its commodities chemicals business to Georgia Gulf Corp. The spinoff created a new company, Axiall, which consists of the former PPG unit and Georgia Gulf's business. PPG said the tender offer was oversubscribed, so that only a portion of the shares tendered were accepted. PPG accepted 10.8 million, or about 14 percent, of the 72.1 million PPG shares tendered by investors who wanted to own shares of Axiall. PPG shareholders will receive 3.26 Axiall shares for each of the shares tendered and accepted.
Average gas cost here leaps to $3.546
The cost of gasoline in Western Pennsylvania jumped this week, with the average price for gallon of regular unleaded hitting $3.546, or up about a nickel from last week. The price for a comparable gallon nationwide was $3.327, or also up about five cents, according to GasBuddy.com.
Somerset County facility will end baby delivery
Windber Medical Center in Somerset County will no longer deliver babies after March 31. Citing "a change of practice direction" by two of its obstetricians and the relocation of the remaining physicians, hospital officials said the time and cost involved in recruiting new obstetricians "may not be feasible."
Agriculture Department warns of restaurant scam
The Pennsylvania Department of Agriculture is warning restaurant owners and managers across the state to be alert for a possible scam in which an unidentified caller claims to be a health inspector and asks for business information and money. Such calls are not being made by any licensed agents of the state or any county, the department said. Similar incidents occurred across the state in 2011. Any suspicious calls should be reported to local law enforcement, the department said.
WVS Financial sees rise in net income for fiscal Q2
WVS Financial Corp., parent company of West View Savings Bank, said net income for the second fiscal quarter ended Dec. 31 rose to $325,000, or 16 cents per share, from $204,000, or 10 cents, in the same three months a year earlier. Net interest income fell while non-interest income rose, aided by a special gain on the sale of real estate.
J.C. Penney rethinks year-old strategy and revives sales
J.C. Penney is bringing back sales. The move is a reversal for the struggling chain on the eve of the one-year anniversary when it vowed to almost completely get rid of sales and offer everyday low prices. Penney also plans to add price tags or signs for more than half of its merchandise to show customers how much they're saving by shopping at the chain. CEO Ron Johnson told The Associated Press that the latest moves are not a "deviation" from his strategy but rather an "evolution."
Durable goods orders rise 4.6% on aircraft
The Commerce Department said Monday that orders for durable goods increased 4.6 percent in December compared with November. The gains were led by a 56.4 percent increase in military aircraft orders and a 10.1 percent increase in commercial aircraft orders. Orders for non-defense capital goods excluding aircraft increased 0.2 percent following gains of 3 percent in November and October. Orders for non-defense capital goods excluding aircraft have climbed for three straight months just one other time in the past five years, from May through July 2011.
Tight inventory slows U.S. pending home sales
The National Association of Realtors said Monday that its seasonally adjusted index for pending home sales dropped 4.3 percent in December from November to 101.7. That's still 6.9 percent higher than a year ago. "We believe the disappointment represents just a brief lull in what are volatile data rather than a fundamental change of direction," said Jim O'Sullivan, an economist at High Frequency Economics.
Toyota returns to No. 1 in global auto sales
Toyota Motor sold a record 9.75 million vehicles last year, according to an official tally released Monday, roaring past General Motors to reclaim its title as the world's top automaker in 2012. General Motors, which held the top spot in 2011, mustered 9.29 million vehicles in global sales last year. The U.S. company had been the top-selling automaker for decades before losing its lead to Toyota in 2008. Volkswagen sold 9.1 million vehicles last year, a record for the German automaker, which has expanded its presence in emerging markets. VW also outsold Toyota in 2011.
Also in business...
American Eagle Outfitters Inc. plans to open its first company-owned and operated store in Mexico City in late February, as part of the South Side-based clothing retailer's move to open a series of stores in Mexico. ... Taco Bell is pulling a TV ad after receiving complaints that it discouraged people from eating vegetables. The ad by the fast-food chain was touting its variety 12-pack of tacos, with a voiceover saying that bringing a vegetable tray to a party is "like punting on fourth and one."