- - Monday, May 9, 2011

BANKS

Bank lets clients OK overdrafts via text

NEW YORK — If you’re willing to pay a $35 fee to overdraw your checking account, just text your approval to the bank.

Under a pilot program at Bank of America, customers would be able to instantly reverse a declined transaction.

News of the test program comes just a year after the bank stopped permitting transactions that overdraw a customer’s account at the register. At the time, Bank of America touted the decision as a consumer-friendly policy that would prevent customers from unknowingly overdrafting their checking accounts and incurring penalty fees.

The company’s decision was also a response to regulatory changes; a rule that went into effect last summer prohibits banks from enrolling customers in overdraft programs without their active consent.

STOCKS

H&R Block tumbles on fears about mortgages

NEW YORK — Shares of H&R Block Inc. led the S&P 500 downward Monday on renewed fears that the company will be dragged back into a subprime mortgage mess.

A group of mortgage bond investors may try to force H&R Block’s former mortgage unit to buy back billions of dollars in defaulted home loans, according to a report by Reuters news agency, sending shares sliding nearly 8 percent.

Calls to an attorney representing the group were not returned. An H&R Block spokesman issued a statement that it had not received any requests, and could not comment on actions by outside parties.

Morgan Stanley analyst Vance Edelson said that many — but not all — Block investors had grown complacent about the mortgage issue over the past year. The topic has been raised on every recent conference call. “This has remained part of the investor debate, because many investors have realized that H&R Block is not entirely out of the woods on this issue.”

CANADA

Quebec unveils plan to develop northern territory

LEVIS — Quebec’s provincial government unveiled Monday a massive plan to develop Northern Quebec while at the same time environmentally protecting half of the area, which is almost 10 times the size of New York state.

Premier Jean Charest unveiled his “Plan Nord” project that he said will lead to $80 billion in public and private investments and create 500,000 jobs over 25 years.

The largely untouched area of 460,000 square miles accounts for 72 percent of the French-speaking province and contains all of its iron ore, nickel, zinc and deposits.

The government said 11 new mining projects are under development and estimates $47 billion will be spent on the development of renewable energy and $33 billion on the mining sector and public infrastructure. An initial $2.1 billion will be spent by Quebec on roads and airports as well as feasibility studies.

The plan includes a large increase in hydropower electricity production, which is planned for export to the northeastern U.S.

EUROPE

Downgrade hits Greece; EU ponders more help

LONDON — Two major credit agencies signaled their concern about Greece’s massive debt Monday, lending new credence to the view that European authorities must do more to help the country a year after it barely avoided bankruptcy with a bailout.

Experts from the European Union and the International Monetary Fund were in Greece on Monday to check up on economic reforms the government promised to make in return for — $160 billion in rescue loans last year. They were also examining whether the current bailout is enough so Athens can stand on its own feet again when the loans run out in 2013 — a scenario most investors think is unlikely.

Credit rating agency Standard & Poor’s cut Greece’s bond grade further to junk status Monday, saying was increasingly likely that Greece would be given more time to repay its bailout loans and that Greece would negotiate a similar deal on bonds held by commercial investors.

S&P, which downgraded the long-term bonds to B from BB-, said Greece might eventually have to resort to a partial default, reneging on as much as 50 percent of its debt. As a result, the agency said it could downgrade Greece again in coming months.

From wire dispatches and staff reports

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