Ukraine rating revised
Standard & Poor’s revised its outlook on Ukraine to “stable” from “negative,” saying that the IMF program adopted in April has helped improve the economic situation in the country. However, the agency said that the IMF program could be impacted by geopolitical risks and a severe recession. “Full disbursement of the International Monetary Fund program and related multilateral lending should enable Ukraine to meet its external financing needs over the next year,” the ratings agency said in a statement. Standard & Poor’s also said the new government under Ukrainian Prime Minister Arseny Yatseniuk had been stable and “relatively cohesive.” The IMF’s board signed off on a US$17 billion two-year aid program for Ukraine in April to help the economy recover after months of upheaval.
US slows illegal dumping
The US Commerce Department declared on Friday that South Korean steel companies and those in seven other countries were illegally dumping low-cost steel pipes and tubing into the US construction market and would be subject to additional duties. China has been the primary target of ire among steel manufacturers in the US, having exported vast quantities of steel in the last decade. In 2010, the US levied duties on the importation of Chinese steel tubes in a major victory for the US industry. However, since that ruling, South Korea and other countries have stepped into the vacuum left by a drop in Chinese imports. Last year, South Korea exported 894,300 tonnes of steel tubes into the US at a value of more than US$800 million, according to data released by the US Commerce Department.
Affiliates to merge
Japan’s Softbank and Deutsche Telekom of Germany have reached a basic agreement for a merger between their US affiliates Sprint and T-Mobile US, the Nikkei Business Daily reported yesterday. Eight financial institutions, including Japan’s top three megabanks Mizuho, Mitsubishi UFJ and Sumitomo Mitsui, are to provide a credit line of around ￥4 trillion (US$39 billion) for Softbank’s purchase of T-Mobile through Sprint, according to the report. The combined subscriber base of Sprint, ranked third among US mobile phone firms, and fourth-ranked T-Mobile roughly equals those of the sector’s two leaders — top-ranked Verizon Wireless and AT&T, the daily said.
Wells Fargo profit up 3.8%
Wells Fargo & Co said profit increased 3.8 percent on lower credit costs even as the lender’s per-share earnings failed to top the preceding quarter’s for the first time since 2009. Net income for the second quarter advanced to US$5.73 billion, or US$1.01 a share, from US$5.52 billion, or US$0.98, a year earlier, the San Francisco-based lender said on Friday in a statement. The average estimate of 31 analysts surveyed by Bloomberg was US$1.01 a share excluding special items. Earnings per share fell from US$1.05 in the three months ended March 31. Chief executive officer John Stumpf has sought to counter a drop in mortgage revenue as higher interest rates crimp new home loans. He has expanded in businesses including credit-card and auto lending, investment banking and retail wealth management to help cover the shortfall.