- The Washington Times - Sunday, August 7, 2011

DEALINGS

Buffett division bids for Transatlantic insurer

NEW YORK — A unit of Warren Buffett’s Berkshire Hathaway Inc. has bid $3.25 billion for insurer Transatlantic Holdings.

Berkshire’s National Indemnity Co. is offering $52 per share in cash for Transatlantic. That tops the price the company would get in its agreement to be bought by Allied World Assurance Co.

In a letter released by Transatlantic on Sunday, National Indemnity said its offer isn’t subject to due diligence or financing conditions. The company said it wants a formal response from Transatlantic no later than the close of business Monday. If the offer is accepted, National Indemnity would want a $75 million break-up fee if the transaction did not close by the end of the year.

Transatlantic’s board said it would carefully weigh the offer by National Indemnity and asked its shareholders to wait until it has a chance to judge it before taking action. But the company also reaffirmed its recommendation of the deal with Allied World Assurance, which is based in Switzerland.

DEBT CRISIS

European Central Bank to buy government bonds

FRANKFURT, Germany — The European Central Bank says it will “actively implement” a bond-purchase program that could boost Spanish and Italian bonds and drive down interest yields that threaten those countries’ budgets.

That could help Rome and Madrid fend off market trouble until a strengthened eurozone bailout fund is approved to help them.

The bank did not say Sunday which countries’ bonds it would buy in a statement after a crisis conference call Sunday. But the beneficiaries are expected to be Italy and Spain, market analysts say.

Italy and Spain are trying to avoid financial collapses like those that have forced Greece, Ireland and Portugal to seek bailout loans.

BANKS

Feds: Probe into WaMu ends with no charges

NEW YORK — The Justice Department says it has closed its investigation into the collapse of Washington Mutual without any criminal charges filed.

In September 2008, the federal government seized Washington Mutual’s flagship bank, based in Seattle, and sold its assets to JPMorgan Chase & Co. for $1.9 billion. It was the biggest bank failure in U.S. history.

The Justice Department, the FBI, and the Securities and Exchange Commission opened investigations into Washington Mutual’s collapse shortly after, in October 2008.

The U.S. attorney’s office for the western district of Washington, which includes Seattle, on Friday evening issued a statement saying that after an “extensive investigation that included hundreds of interviews and the review of millions of documents,” there were not grounds for criminal charges.

BANKS

Wells Fargo reaches settlement with Wachovia

NEW YORK — Wells Fargo & Co. on Friday said that it has agreed to pay $590 million to settle a class-action lawsuit filed by investors in Wachovia securities.

The settlement would end a suit filed in 2008 in federal court in Manhattan, charging that Wachovia misled investors in its bonds and preferred securities by understating losses associated with risky mortgages. Wells Fargo bought Wachovia that year at the height of the financial crisis.

The San Francisco-based bank said in a regulatory filing with the Securities and Exchange Commission that the deal needs court approval before it takes effect.

Investors said in the suit that Wachovia repeatedly claimed that its mortgage loans were made with “high underwriting standards and a conservative approach to lending.” But they claimed that after the bank bought Golden West Financial Corp. in 2006, it started using that bank’s riskiest practices.

From wire dispatches and staff reports

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