BUSINESS BRIEFS
Fed offers banks up to $900 billion
Associated Press
WASHINGTON — The Federal Reserve said yesterday it will provide as much as $900 billion in cash loans to squeezed banks in an urgent effort to break through a dangerous credit clog that threatens the economy and has unhinged financial markets around the globe.
The Fed's action is aimed at spurring spooked financial institutions, which are hoarding cash, to lend not only to each other but also to individuals and businesses.
BANKS AGREE TO HALT LITIGATION
NEW YORK — Wachovia, Citi- group and Wells Fargo yesterday agreed to a standstill of all formal litigation activity — a sign that the banks and the Federal Reserve are working feverishly to reach an agreement over the fate of Wachovia. The standstill agreement will end at noon tomorrow, unless extended.
Federal Reserve officials have been in talks with Wells Fargo and Citigroup in the hope of getting the parties to come to some sort of agreement.
BANK OF AMERICA SHOWS PROFIT DROP
NEW YORK — Bank of America Corp. yesterday reported its third-quarter results earlier than planned, revealing a 68 percent profit drop and plans to boost capital by selling stock and halving its dividend.
Like most other major financial institutions, Bank of America has been hit by significant losses in mortgages, credit cards and other souring debt.
Profit fell to $1.18 billion, or 15 cents per share, for the July-to-September period from $3.7 billion, or 82 cents per share, in the same period last year.
ELI LILLY BUYING IMCLONE FOR $6B
INDIANAPOLIS — Eli Lilly & Co. has agreed to spend more than $6 billion to fortify its cancer treatment portfolio by acquiring the biotechnology firm ImClone Systems Inc. in a deal that tops earlier offers from competitor Bristol-Myers Squibb Co.
Indianapolis-based Lilly announced yesterday that it will pay $70 per share for ImClone. New York-based Bristol-Myers then said it would not increase its latest offer of $62 per share, but would pocket about $1 billion for its 14 million ImClone shares.
PROBE BEGINS INTO LEHMAN COLLAPSE
WASHINGTON— The now-bankrupt investment bank Lehman Brothers arranged millions in bonuses for fired executives as it pleaded for a federal lifeline, lawmakers learned yesterday, as Congress began investigating what went so wrong on Wall Street to prompt a $700 billion government bailout.
The first in a series of congressional hearings on the roots of the financial meltdown yielded few major revelations about Lehman's collapse, and none about why government officials, as they scrambled to avert economic catastrophe, declined to rescue the flagging company while injecting tens of billions of dollars into others.
EBAY SLASHES 10% OF ITS WORKFORCE
NEW YORK- EBay Inc. said yesterday it will cut about 1,600 jobs, or 10 percent of its workforce, in its largest round of dismissals ever.
About 1,000 full-time employees will be gone, while eBay will achieve the rest of the cuts by letting temporary and part-time workers go and by leaving open positions unfilled. The auction site operator would not describe which positions would be cut, other than to say they will come from around the world.
OIL PRICES LOWEST IN EIGHT MONTHS
NEW YORK— Oil prices plunged below $90 a barrel yesterday, coming within reach of year-ago levels as a widening financial maelstrom spreads overseas and crimps global demand for energy.
A barrel of oil has not been this cheap in eight months, suggesting that the climate in which oil soared to unheard of levels is coming to an abrupt end.
Crude's stunning fall comes just three months after prices surged close to $150 a barrel.
