Page 25 - ATD14NOV2015
P. 25
BUSINESS A25
Saturday 14 November 2015
Springleaf required to shed 127 branches to buy OneMain
WASHINGTON (AP) — The eral in seven states. The suit two biggest makers of per- ing 6 percent of its total trust suit alleged. Springleaf
federal government is or- alleged that Springleaf’s sonal installment loans to network — to Lendmark has about 830 branches
dering personal finance $4.25 billion acquisition of subprime borrowers in the Financial Services of Cov- in 27 states and outstand-
company Springleaf Hold- OneMain, a Citigroup sub- U.S., according to the Jus- ington, Georgia. The sale is ing loans worth around $4
ings to shed 127 branches sidiary, could hurt com- tice Department. The loans expected to close around billion. OneMain has 1,139
in 11 states in order to ac- petition because people are marketed to consum- April 1, 2016. Springleaf and branches in 43 states and
quire OneMain Financial with weak credit seeking ers with limited access to OneMain both specialize $8.4 billion in outstanding
Holdings. personal loans would face credit from conventional in large installment loans loans. The 11 states are
The required divestiture, an- fewer local market choices banks, and have fixed in- from $3,000 to $6,000, tar- Arizona, California, Colora-
nounced Friday, would set- in 11 states. terest rates and payment get the same customer do, Idaho, North Carolina,
tle an antitrust lawsuit filed Springleaf, based in Evans- periods. Springleaf said it base, and have substantial Ohio, Pennsylvania, Texas,
by the U.S. Justice Depart- ville, Indiana, and Balti- has agreed to sell the 127 geographic overlap in their Virginia, Washington and
ment and attorneys gen- more’s OneMain are the branches — represent- branch networks, the anti- West Virginia.q
JC Penney reports loss, sales growth, but shares skid
PLANO, Texas (AP) — J.C. strom were all down Friday. Shoppers visit a J.C. Penney store in New York. The Texas-based retailer reported quarterly
Penny reported stronger- J.C. Penney, meanwhile,
than-expected sales for fared better than its peers financial results, Friday, Nov. 13, 2015. (AP Photo/Mark Lennihan)
the third-quarter, but the in the third quarter, with
department store opera- sales up 6.4 percent at tomers, they believe that and get them to visit more came to 47 cents per
tor’s failure to raise its fore- established locations. The they are national brands,” frequently and spend share. Analysts had fore-
cast for the year appeared company also said its gross said CEO Marvin Ellison, more per visit. cast a steeper loss of 58
to add to worries that up- margin improved, driven who joined the company The company, based in cents per share, accord-
coming holiday shopping by supply chain produc- a year ago. Plano, Texas, said its loss ing to Zacks Investment
season could turn out to tivity and improvements in Ellison also noted the com- narrowed to $137 million, Research.
be a dud for retailers. margins for its sale items. pany is increasingly using or 45 cents per share, for Revenue rose to $2.9 bil-
The company’s results fol- Yet the company main- Sephora makeup loca- the period ending Oct. lion, also exceeding Street
low disappointing sales tained its full-year forecast tions within its stores to at- 31. Losses, adjusted for forecasts of revenue of
this week from Macy’s and for sales to climb between tract younger customers, one-time gains and costs, $2.86 billion.q
Nordstrom, which both cut 4 and 5 percent. Its shares
their outlooks for the year were down more than 11
citing softer sales trends. percent at $7.79.
Macy’s blamed its sales The company is also still
decline in the third quar- bleeding money, but is
ter partly on warmer than hoping to change that by
normal weather, which it cutting costs and continu-
said hurt sales of items like ing to push up sales.
coats and boots. A big part of the strategy
As a result, Macy’s CEO is focusing more on J.C.
Terry Lundgren also said Penney’s private brands,
the company would need which tend to cost the
to mark down items during company less to carry
the holiday season to get on shelves than national
rid of its merchandise by name brands. J.C. Penney
the end of year. It said that says private brands, which
would result in lower sales account for 51 percent
and gross margin in the of sales, represent a big
fourth quarter, compared opportunity for improving
to a year ago. Shares of margins.
Macy’s, Kohl’s and Nord- “When you survey our cus-
US producer prices drop in latest sign of tame inflation
C. S. RUGABER fell 0.4 percent last month. percent inflation rate as will do so when they are in October, the govern-
AP Economics Writer That follows a 0.5 percent a cushion against falling “reasonably confident” ment said.
WASHINGTON (AP) — The drop in September. In prices, or deflation. that inflation is returning to And earlier this week, Eric
prices charged by farm- the past year, wholesale While consumers may like their 2 percent target. Rosengren, president of
ers, manufacturers and prices have dropped 1.6 lower prices, deflation can So far, most inflation gaug- the Federal Reserve Bank
other producers fell in percent. That’s the steep- drag down wages, make es remain below that of Boston, struck an up-
October for the second est drop since the govern- debts harder to repay and level. The Fed’s preferred beat note on the econo-
straight month, fresh evi- ment began tracking the is difficult for the Fed to re- inflation measure rose just my and said he is “reason-
dence that there is little data in 2010. verse. 0.2 percent in September, ably confident” inflation
sign of inflation in the U.S. Tepid wage increases Fed officials are widely ex- and is up only 1.3 percent will soon reach 2 percent.
economy. have limited retailers’ abil- pected to raise the short- in the past year. In October, wholesale
The Labor Department ity to raise prices, keeping term interest rate they con- Still, there are signs that prices were pulled lower
said Friday the producer a lid on inflation. Weak trol for the first time in nine the deflationary impact of by a sharp drop in the
price index, which mea- price gains pose a chal- years at their next meeting lower gas prices may be profit margins reported by
sures price changes before lenge for the Federal Re- in December. Fed chair starting to fade. Wholesale gas stations and by falling
they reach the consumer, serve, which targets a 2 Janet Yellen has said they gas prices rose 3.8 percent prices for food.q
