- - Tuesday, December 20, 2011

FEDERAL RESERVE

Banks asked to keep more cash at hand

The Federal Reserve on Tuesday moved to toughen capital requirements for the country’s largest banks, saying their size and stretch could threaten the overall financial system.

The Fed said it was preparing to implement new capital and liquidity rules outlined by an international banking pact on nearly three dozen banks with assets of more than $50 billion.

Rebuffing resistance from some of the country’s most powerful financiers, the Fed said it would apply the extra-tough standards of the Basel III pact on 29 “globally systemically important banks.”

That could mean even tougher standards for the eight American banks and bank-holding companies on that list: Bank of America, BNY Mellon, Citigroup, Goldman Sachs, JPMorgan Chase, State Street and Wells Fargo.

“The recent financial crisis showed that some financial companies had grown so large, leveraged, and interconnected that their failure could pose a threat to overall financial stability,” the Fed said.

REAL ESTATE

Rise in home building suggests industry turnaround

A surge in apartment construction gave homebuilders more work in November. Permits, a gauge of future construction, rose, too, largely because of a jump in apartment permits.

Some analysts say the gains, though coming off extremely low levels, suggest the depressed housing industry may have reached a turning point.

Economists now say 2011 will be the first year since the Great Recession began in 2007 that home construction will have helped the economy grow. Before this year, the industry endured two of the worst years ever.

Builders broke ground on a seasonally adjusted annual rate of 685,000 homes in November, a 9.3 percent jump from October, the government said Tuesday. It’s the highest level since April 2010.

AUTO

Competition forces Honda to revamp new Civic

ROMULUS, Mich. — Honda is scrambling to revamp its Civic just eight months after a new version hit showrooms, and critics say it’s an admission that the compact car fell short in quality and handling.

The revamp, to come by the end of next year, is unprecedented because new models usually aren’t overhauled for at least three years. Honda executives say they’re simply trying to stay ahead in an increasingly competitive small-car market.

The new version of the Civic started arriving at dealerships April 20 and was panned by critics. Consumer Reports magazine said it was less agile than its predecessor and its interior quality was worse.

TOBACCO

Groups ask to nix Bowl cigar sponsor

RICHMOND — Several public health organizations are asking the Orange Bowl and the NCAA to pull a three-year sponsorship deal with a Florida cigar company.

The Campaign for Tobacco-Free Kids and nine other groups say Camacho Cigars’ sponsorship of the football games shouldn’t be allowed under federal law.

The sponsorship deal includes a large presence at several game-day events for the maker of Camacho and Baccarat the Game brand cigars, plus lounges where fans can light up. The agreement is for the 2012-14 Orange Bowl games and the 2013 BCS National Championship.

A 2009 law gave the Food and Drug Administration authority to regulate tobacco products including cigarettes and smokeless tobacco, but it has not yet asserted its power over cigars. The FDA prohibits tobacco companies from sponsoring events using brand names.

From wire dispatches and staff reports

LOAD COMMENTS ()

 

Click to Read More

Click to Hide