Modifications can’t save many mortgages
Struggling homeowners who received loan modifications under a federal government program are defaulting on their mortgages at an alarming rate, according to a watchdog report. The report from the inspector general for the Troubled Asset Relief Program said the Treasury Department’s Home Affordable Modification Program, or HAMP, has failed to ensure that mortgage reductions are sustainable. Home loans modified in the third and fourth quarters of 2009 are now defaulting at a rate of 46 percent and 39 percent, respectively. As of the end of March, more than 312,000 homeowners have defaulted on mortgages modified under HAMP, according to the report.
Durable goods orders fell sharply last month
Orders for big-ticket items posted the biggest drop in March since last summer, mainly because of fewer jetliner bookings, but the generally soft report added to mounting evidence that the U.S. economy has slowed again. Orders for durable goods fell a seasonally adjusted 5.7 percent last month to mark the biggest drop since last August, the Commerce Department said. Economists surveyed by MarketWatch had expected a 3.2 percent decline. Durable goods are products designed to last at least three years. These orders are critical component of U.S. growth since rising sales of autos, computers and furniture signal an improving economy.
This time, Citigroup compensation is OK’d
Citigroup Inc. shareholders, who rejected the bank’s 2011 compensation plan, voted in favor of the latest round of payouts after the lender said it overhauled rewards for top executives. The 2012 plan, which includes an $11.5 million package for new Chief Executive Michael Corbat, received more than 90 percent of votes cast in the nonbinding tally, Secretary Rohan Weerasinghe said at the annual meeting in New York. The approval is a success for Corbat and Chairman Michael O’Neill, who said in February that the bank had changed how it paid top executives so that rewards would be tied to performance.
Georgia-Pacific to buy cellulose product maker
Georgia-Pacific, the U.S. paper and pulp producer controlled by the Koch brothers, agreed to buy Buckeye Technologies for about $1.45 billion to add cellulose products output. Closely held Georgia-Pacific will pay $37.50 a share, the companies said. That’s 25 percent more than Memphis, Tenn.-based Buckeye’s closing price Tuesday. Buckeye makes specialty fibers and materials from wood and cotton that are used in everything from oil filters to nail polish.
Samsung’s Galaxy S4 phone in short supply
Samsung Electronics Co. said that its flagship Galaxy S4 device is in limited supply, suggesting that shipment delays reported by two top U.S. wireless carriers stem from a worldwide inventory crunch. “Due to overwhelming global demand of Galaxy S4, the initial supply may be limited,” South Korea-based Samsung said. “We expect to fulfill inventory to meet demands in the coming weeks.” The constraint is contributing to a slow start for the device in the U.S., where Samsung aims to supplant Apple Inc. as the top-selling smartphone maker.
MetroPCS shareholders OK T-Mobile merger
MetroPCS Communications Inc. shareholders approved a sweetened deal to merge with Deutsche Telekom AG’s T-Mobile USA in a crucial vote that gives the German company a chance to revive its U.S. business. The transaction will probably be completed by May 1 after Wednesday’s ballot cleared the final hurdle for the combination of the country’s fourth- and fifth-largest wireless carriers, Deutsche Telekom said. Deutsche Telekom on April 10 agreed to lower the size and interest rate of a loan to the joint company.
Amazon said to work on streaming video box
Amazon.com Inc., the world’s largest online retailer, plans to release a television set-top box that would stream video over the Internet into customers’ homes, Bloomberg News reported. The device, due later this year, will connect to televisions, Bloomberg said, citing anonymous sources. It will also provide access to Amazon’s expanding video services, which include the Amazon Video on Demand store.
Dell investor sells stake after deal falls through
William Nygren, whose Oakmark mutual funds owned about 1.6 percent of Dell Inc. shares, said he sold his stake after Blackstone Group withdrew its bid to buy the computer maker. “Our numbers suggested Dell should be worth a premium to the $13.65 offer from management, but then a potential acquirer with access to nonpublic information decided to end its quest to acquire Dell at a higher price,” Nygren said in a letter, referring to Blackstone. “Since they had information we didn’t, we believed it was prudent to assume they might be right.”