The management of two of the largest financial groups in the U.S. – Citigroup and Bank of America, has received an average salary of 18 million dollars per person in 2008 This happens within the same year, when both are threatened by bankruptcy banks received 90 billion dollars financial assistance from the state. For example, Citigroup has paid 390.2 million dollars for 21 people from top management, and Bank of America for an amount estimated at 227.8 million dollars, divided between 13 executives. The amount per person in the first case amounts to 18.6 million dollars, while the second – for 17,5 million dollars, police Bloomberg. The average salary for managers of both banks is double that of the other five rescued by the state financial institutions. Faynbarg Kenneth, who was charged with the task of government to ensure that bonuses and pension packages at high-paid 100 managers of troubled companies instruct their salaries for 2009 to be shortened by an average of 50%.
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The main stock indexes in the United States fell in early on the last trading session this week, after the financial results of General Electric and Bank of America disappoint investors, and the index of consumer confidence in the University of Michigan unexpectedly decreased. As a result, Dow Jones IA away from the one-year peak, which subdued during yesterday’s session. Two hours after the start of trading the index of the 30 largest companies on the New York Stock Exchange decreased by nearly 1 percent to 9962.9 points. The wider S & P 500 retreated further to 1.1 percent to 1084.2 points while the index of companies by the exchange Nasdaq – Nasdaq Composite, lost 1.3 percent to 2145.5 points. Financial and technology companies are ranked among the top companies in the losers of the session. The loss of the largest in size of its assets to U.S. Bank Bank of America for the third quarter was greater than expected. Investors ignored the good financial results on Google and IBM, and the rise of industrial production by 0.7 percent in September.
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The indexes of the Old Continent ended with reductions this week for the last session on Thursday after pan-European index Dow Jones Stoxx 600 rose to its highest level in 12 months. Reason for this became worse-than-expected quarterly results at Sony Ericsson, General Electric and Bank of America. Financial companies in the composition of the Dow Jones Stoxx 600 contributed most to today’s drop the index. Dow Jones Stoxx 600, which monitors the securities markets in 18 western states, slid 0.7 percent to 245.58 points. Thus limit its stock measure ahead of the start of the week to 1.2 percent. With the sharp drop today distinguish the Exchange in Athens. The main Greek ASE index decreased by 2.2 percent to 2830 points after news that the Treasury may impose a single tax profits of banks and other companies. Thus the government hopes to reduce the large budget deficit of the country. Shares of National Bank of Greece, which is the largest credit institution in Greece, fell by 3.6 percent to 26.80 euros per share after the news. In Britain’s FTSE 100 was down by 0.6 percent to 5190 points, but the record weekly rise of 0.6 percent. Top losers were financial and extractive companies because of disappointing results at Bank of America and cheaper metals.
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The largest U.S. bank Bank of America reported second loss within one year. For the period July September financial institution has a negative financial result of 1 billion dollars or 26 cents a share. The last loss was reported for the fourth quarter of 2008. The result of the previous quarter, in contrast to profit of 1.18 billion dollars for the same period of 2008, analysts expect losses to be at the rate of 12 cents per share. The quarterly report will be the last that will be the responsibility of the current CEO Kenneth Lewis, who left the institution at the end of the year because of criticism that suffered after the acquisition of Meriil Lynch. Exactly acquired at the beginning of this year, investment bank has contributed to smaller losses in this quarter because of good results from trading in shares, debt securities and currencies.
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The Executive Director of Bank of America Kenneth Lewis announced his retirement from office on 31 December. The Bank, one of the most affected by the financial crisis after a controversial effects buy Merrill Lynch, supported by the Federal Reserve has not yet found a successor to Lewis. Earlier this year, was forced to retire from post at board chairmen of directors of the bank has notified its decision to other leaders. The Executive Director of Bank of America believes that it is strong enough to cope with the challenges ahead in the market. The loss of positions for Lewis came after he realized that he had approved the purchase of the assets of Merrill Lynch without informing investors about the bank’s huge losses.
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The growth of Russian economy in 2010 will be 3.9 percent of recent estimates show Bank of America. This is an upward revision from the previous forecast of 2.4 to increase the country’s GDP. The new estimate is based on higher fuel prices, which are among the main export goods to Moscow, and the government provided incentives. For the second quarter of this year the country reported the largest decrease in its gross domestic product – 10.9% annually after the first quarter the economy shrank by 9.5%. In July, the IMF forecast economic growth of Russia with 1.5 percent for next year and a decline of 6.5 percent for this.
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The Bank of America, the largest lender in the U.S., is facing 10 percent jump in bad loans to $ 7.6 billion in its balance sheet for the second quarter, according to a report of Credit Suisse, cited by Bloomberg. Bad debts include $ 1.9 billion related to residential mortgages, and approximately 10.4% of credit card loans will be written off, according to the report analyzer Moshe Orenbuh. In the first quarter of 2009, Bank of America credits deleted $ 6.9 billion. Bank of America is first in U.S. assets and deposits will take into account one hundred 32-share profit for the quarter, including $ 5.2 billion profit before tax from the sale of its share in China Construction Bank.
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