WASHINGTON — The Obama administration will order companies that received huge government bailouts last year to slash the base salaries of their top executives by an average of 90 percent and cut their total compensation in half.

The cuts apply to the 25 highest paid executives at the seven companies that received the most assistance.

Smaller firms and those that have repaid the bailout money, including Goldman Sachs Group Inc. and JPMorgan, are not affected.

The Treasury is expected to announce the cuts within the next few days.

Kenneth Feinberg, the special master at Treasury appointed to handle compensation issues as part of the government's $700 billion financial bailout package, is making the pay decisions.

The seven companies are Bank of America Corp., American International Group Inc., Citigroup Inc., General Motors, GMAC, Chrysler and Chrysler Financial.

FED REPORT INDICATES RECOVERY UNDER WAY

WASHINGTON — Improvements in housing and manufacturing are driving the early stages of the economic recovery, according to a Federal Reserve survey released yesterday.

The Fed's latest snapshot of business conditions nationwide found "many sectors" of the economy either stabilized or logged modest improvements over the past six weeks.

The pickups, though, often were from "depressed" levels of activity.

Still, the new report adds to evidence that a recovery has started from the worst recession since the 1930s. Only two of the Fed's 12 regions — Atlanta and St. Louis — reported weaker overall economic activity.

EBAY REVENUE RISES AS INCOME DROPS

SAN FRANCISCO — EBay Inc. said that even as third-quarter net income dipped 29 percent, its revenue rose largely because more people and merchants are using PayPal to pay for things online.

The San Jose-based company said the number of active PayPal accounts rose 19 percent to 78 million compared with a year earlier.

That contributed to a 15 percent revenue jump to $688.1 million in its payments business — which includes PayPal and short-term credit service Bill Me Later.

But eBay's core marketplaces business, which includes the main eBay site and other sites such as www.Shopping.com, saw revenue dip 1 percent to $1.4 billion.

The company attributed this decline partly to the negative impact of foreign exchange differences.

MORGAN STANLEY'S BACK IN BLACK

NEW YORK — Morgan Stanley returned to profitability for the first time in a year as income from its investment banking operations offset losses in commercial real estate.

Morgan Stanley said yesterday that stock and debt underwriting from investment banking, and rising profits from its retail brokerage business, which includes the Morgan Stanley Smith Barney joint venture with Citigroup Inc., more than balanced out $400 million in real estate losses.

The New York-based bank earned $498 million in the July-September period, after losing $13.18 billion during the last three quarters combined.

Investors sent Morgan Stanley stock up sharply in afternoon trading, brushing off any concerns about the bank's commercial real estate exposure. Shares jumped $2.25, or 6.9 percent, to $34.77.